Cover
Cover - shares | 6 Months Ended | |
Dec. 31, 2023 | Feb. 14, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Dec. 31, 2023 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2024 | |
Current Fiscal Year End Date | --06-30 | |
Entity File Number | 000-15113 | |
Entity Registrant Name | VERITEC, INC. | |
Entity Central Index Key | 0000773318 | |
Entity Tax Identification Number | 95-3954373 | |
Entity Incorporation, State or Country Code | NV | |
Entity Address, Address Line One | 2445 Winnetka Avenue N. | |
Entity Address, City or Town | Golden Valley | |
Entity Address, State or Province | MN | |
Entity Address, Postal Zip Code | 55427 | |
City Area Code | (763) | |
Local Phone Number | 253-2670 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | VRTC | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 39,988,007 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Current Assets: | ||
Cash | $ 59,000 | $ 61,000 |
Accounts receivable | 46,000 | 7,000 |
Prepaid expenses and other current assets | 6,000 | 6,000 |
Total Assets | 111,000 | 74,000 |
Current Liabilities: | ||
Accounts payable | 300,000 | 289,000 |
Accounts payable, related party | 119,000 | 119,000 |
Accrued expenses | 60,000 | 60,000 |
Customer deposits | 29,000 | 29,000 |
Convertible notes and notes payable ($555,000 and $525,000 in default) | 581,000 | 570,000 |
Convertible notes and notes payable, related parties ($247,000 and $242,000 in default) | 7,878,000 | 7,322,000 |
Total Current Liabilities | 8,967,000 | 8,389,000 |
Deferred revenues | 200,000 | 200,000 |
Contingent earnout liability | 155,000 | 155,000 |
Total Liabilities | 9,322,000 | 8,744,000 |
Stockholders' Deficit: | ||
Convertible Preferred stock, par value $1.00; 10,000,000 shares authorized; 276,000 shares of Series H authorized; 1,000 shares issued and outstanding | 1,000 | 1,000 |
Common Stock, par value $.01; 150,000,000 shares authorized; 39,988,007 and 39,988,007 shares issued and outstanding, respectively | 400,000 | 400,000 |
Common stock to be issued, 145,000 shares to be issued | 12,000 | 12,000 |
Additional paid in capital | 18,143,000 | 18,143,000 |
Accumulated deficit | (27,767,000) | (27,226,000) |
Total Stockholders' Deficit | (9,211,000) | (8,670,000) |
Total Liabilities and Stockholders' Deficit | $ 111,000 | $ 74,000 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Convertible notes and notes payable, in default | $ 555,000 | $ 525,000 |
Convertible notes and notes payable, related party, in default | $ 247,000 | $ 242,000 |
Preferred Stock, Par or Stated Value Per Share | $ 1 | $ 1 |
Preferred Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 150,000,000 | 150,000,000 |
Common Stock, Shares, Outstanding | 39,988,007 | 39,988,007 |
Convertible Preferred Stock [Member] | ||
Preferred Stock, Shares Authorized | 276,000 | 276,000 |
Preferred Stock, Shares Outstanding | 1,000 | 1,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Revenue: | ||||
Mobile banking technology revenue | $ 53,000 | $ 70,000 | $ 74,000 | $ 90,000 |
Other revenue, management fee - related party | 54,000 | 37,000 | 91,000 | 118,000 |
Total revenue | 107,000 | 107,000 | 165,000 | 208,000 |
Costs and operating expenses: | ||||
Cost of revenue | 31,000 | 48,000 | 73,000 | 98,000 |
Selling, general and administrative expenses (1) | 174,000 | 209,000 | 365,000 | 451,000 |
Total costs and operating expenses | 205,000 | 257,000 | 438,000 | 549,000 |
Loss from operations | (98,000) | (150,000) | (273,000) | (341,000) |
Other expenses: | ||||
Interest expense (2) | (137,000) | (122,000) | (268,000) | (242,000) |
Total other expenses | (137,000) | (122,000) | (268,000) | (242,000) |
Net loss | $ (235,000) | $ (272,000) | $ (541,000) | $ (583,000) |
Net loss per common share - basic and diluted | $ (0.01) | $ (0.01) | $ (0.01) | $ (0.01) |
Weighted average number of common shares outstanding - basic and diluted | 39,988,007 | 39,988,007 | 39,988,007 | 39,988,007 |
(1) Includes expenses to related party | $ 13,000 | $ 14,000 | $ 26,000 | $ 26,000 |
(2) Includes interest expense to related parties | $ 130,000 | $ 117,000 | $ 256,000 | $ 232,000 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Deficiency - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Balance, June 30, 2022 | $ (8,976,000) | $ (7,747,000) | $ (8,670,000) | $ (7,436,000) |
Net loss for the period | (235,000) | (272,000) | (541,000) | (583,000) |
Balance, December 31, 2022 (unaudited) | (9,211,000) | (8,019,000) | (9,211,000) | (8,019,000) |
Preferred Stock [Member] | ||||
Balance, June 30, 2022 | $ 1,000 | $ 1,000 | $ 1,000 | $ 1,000 |
Shares, Outstanding, Beginning Balance | 1,000 | 1,000 | 1,000 | 1,000 |
Net loss for the period | ||||
Balance, December 31, 2022 (unaudited) | $ 1,000 | $ 1,000 | $ 1,000 | $ 1,000 |
Shares, Outstanding, Ending Balance | 1,000 | 1,000 | 1,000 | 1,000 |
Common Stock [Member] | ||||
Balance, June 30, 2022 | $ 400,000 | $ 400,000 | $ 400,000 | $ 400,000 |
Shares, Outstanding, Beginning Balance | 39,988,007 | 39,988,007 | 39,988,007 | |
Net loss for the period | ||||
Balance, December 31, 2022 (unaudited) | $ 400,000 | $ 400,000 | $ 400,000 | $ 400,000 |
Shares, Outstanding, Ending Balance | 39,988,007 | 39,988,007 | 39,988,007 | 39,988,007 |
Common Stock To Be Issued [Member] | ||||
Balance, June 30, 2022 | $ 12,000 | $ 12,000 | $ 12,000 | $ 12,000 |
Net loss for the period | ||||
Balance, December 31, 2022 (unaudited) | 12,000 | 12,000 | 12,000 | 12,000 |
Additional Paid-in Capital [Member] | ||||
Balance, June 30, 2022 | 18,143,000 | 18,143,000 | 18,143,000 | 18,143,000 |
Net loss for the period | ||||
Balance, December 31, 2022 (unaudited) | 18,143,000 | 18,143,000 | 18,143,000 | 18,143,000 |
Retained Earnings [Member] | ||||
Balance, June 30, 2022 | (27,532,000) | (26,303,000) | (27,226,000) | (25,992,000) |
Net loss for the period | (235,000) | (272,000) | (541,000) | (583,000) |
Balance, December 31, 2022 (unaudited) | $ (27,767,000) | $ (26,575,000) | $ (27,767,000) | $ (26,575,000) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) | 6 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (541,000) | $ (583,000) |
Adjustments to reconcile net loss to cash used in operating activities: | ||
Interest accrued on notes payable | 268,000 | 242,000 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (39,000) | |
Customer deposits | 1,000 | |
Deferred revenue | 0 | 200,000 |
Accounts payable | 11,000 | 17,000 |
Accounts payable - related party | 7,000 | |
Accrued expenses | (1,000) | |
Net cash used in operating activities | (301,000) | (117,000) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from notes payable - related party | 299,000 | 234,000 |
Net cash provided by financing activities | 299,000 | 234,000 |
NET INCREASE (DECREASE) IN CASH | (2,000) | 117,000 |
CASH AT BEGINNING OF PERIOD | 61,000 | 66,000 |
CASH AT END OF PERIOD | 59,000 | 183,000 |
Supplemental disclosures of cash flow information: | ||
Cash paid for income taxes | ||
Cash paid for interest | $ 0 | $ 0 |
OPERATIONS AND SUMMARY OF SIGNI
OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 – OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Company Veritec, Inc. (Veritec or the Company) was formed in the State of Nevada on September 8, 1982. Veritec is primarily engaged in the development, sales, and licensing of products and providing services related to its mobile banking solutions. As a Cardholder Independent Sales Organization, Veritec is able to promote and sell Visa-branded card programs. As a Third-Party Servicer, Veritec provides back-end cardholder transaction processing services for Visa-branded card programs on behalf of its sponsoring bank. Veritec has a portfolio of five United States and eight foreign patents. In addition, we have seven U.S. and twenty-eight foreign pending patent applications. Veritec has had agreements with various banks in the past and is currently seeking a bank to sponsor its Prepaid Card programs. On December 31, 2015, the Company sold all of its assets of its barcode technology, which was comprised solely of its intellectual property, to The Matthews Group, a related party (see Note 6). The Company subsequently entered into a management services agreement with The Matthews Group to manage all facets of the barcode technology operations through June 30, 2024. The Company earns a fee of 35% of all revenues billed up to December 31, 2023, and recognizes management fee revenue as services are performed. Basis of Presentation The accompanying unaudited condensed consolidated financial statements condensed consolidated financial statements In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the period ended December 31 balances are consolidated financial statements The accompanying condensed consolidated financial statements Going Concern The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. During the period ended December 31, 2023, the Company incurred a net loss of $ 541,000 301,000 9,211,000 802,000 The Company believes it will require additional funds to continue its operations through fiscal 2024 and to continue to develop its existing projects and plans to raise such funds by finding additional investors to purchase the Company’s securities, generating sufficient sales revenue, implementing dramatic cost reductions or any combination thereof. There is no assurance that the Company can be successful in raising such funds, generating the necessary sales, or reducing major costs. Further, if the Company is successful in raising such funds from sales of equity securities, the terms of these sales may cause significant dilution to existing holders of common stock. The condensed consolidated financial statements do not include any adjustments that may result from this uncertainty. Use of Estimates The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Those estimates and assumptions include estimates for reserves of uncollectible accounts, accruals for potential liabilities, assumptions made in valuing stock instruments issued for services, and valuation of deferred tax assets. Actual results could differ from those estimates. Revenue Recognition Revenues for the Company are classified into management fee revenue and mobile banking technology. The Company recognizes revenue in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASC 606"). The underlying principle of ASC 606 is to recognize revenue to depict the transfer of goods or services to customers at the amount expected to be collected. ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2) identifying the Company’s performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients. Mobile Banking Technology Revenue The Company, as a merchant payment processor and a distributor, recognizes revenue from transaction fees charged to cardholders for the use of its issued mobile debit cards. The fees are recognized on a monthly basis after all cardholder transactions have been summarized and reconciled with third party processors. Other Revenue, Management Fee – Related Party On December 31, 2015, the Company sold all of its assets of its Barcode Technology, which was comprised solely of its intellectual property, to The Matthews Group (a related party, see Note 6). The Company subsequently entered into a management services agreement with The Matthews Group to manage all facets of the barcode technology operations through June 30, 2024. The Company earned a fee of 35% of all revenues billed up to December 31, 2023. The Company recognizes management fee revenue as services are performed. Disaggregation of Net Sales The following table shows the Company’s disaggregated net sales by customer type: Disaggregate Net Sales Three Months Ended Six Months Ended 2023 2022 2023 2022 Medical $ 38,000 $ 14,000 $ 54,000 $ 28,000 Banking 8,000 ` 50,000 8,000 50,000 Associations 3,000 3,000 6,000 6,000 Education 4,000 3,000 6,000 6,000 Other revenue, management fee related party 54,000 37,000 91,000 118,000 Total revenue $ 107,000 $ 107,000 $ 165,000 $ 208,000 During the six months ended December 31, 2023 and 2022, all of the Company’s Mobile banking technology revenues were earned in the United States of America. Other revenue, management fee - related party revenue was $ 54,000 and $ 91,000 37,000 118,000 for the three and six months ended December 31, 2023 and 2022, respectively, and realized from our management services agreement with The Matthews Group, a related party, which requires us to manage The Matthews Group’s barcode technology operations. The Matthews Group’s barcode technology customers are primarily manufacturing companies located in China. Fair Value of Financial Instruments The Company determines the fair value of its assets and liabilities based on the exchange price in U.S. dollars that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. The Company uses a fair value hierarchy with three levels of inputs, of which the first two are considered observable and the last unobservable, to measure fair value: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Inputs, other than Level 1, that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The carrying amounts of financial instruments such as cash, accounts receivable, and accounts payable and accrued expenses, approximate the related fair values due to the short-term maturities of these instruments. The carrying values of convertible notes and notes payable approximate their fair values due to the fact that the interest rates on these obligations are based on prevailing market interest rates. Net Loss per Common Share Basic earnings (loss) per share are computed by dividing the net income (loss) applicable to common stockholders by the weighted average number of shares of common stock outstanding during the year. Diluted earnings (loss) per share is computed by dividing the net income (loss) applicable to common stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued, using the treasury stock method. Potential common shares are excluded from the computation as their effect is antidilutive. For the period ended December 31, 2023 and 2022, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have an anti-dilutive effect. As of December 31, 2023, and 2022, we excluded the outstanding securities summarized below, which entitle the holders thereof to acquire shares of common stock, from our calculation of earnings per share, as their effect would have been anti-dilutive. Summary of securities excluded from EPS calculation As of December 31, 2023 2022 Series H Preferred Stock 10,000 10,000 Convertible Notes Payable 29,832,306 26,443,994 Options 550,000 900,000 Total 30,392,306 27,353,994 Concentrations During the three months ended December 31, 2023, the Company had one customer that represented 50 33 47 35 No other customer represented more than 10% of our revenues. During the six months ended December 31, 2023, the Company had one customer that represented 55 33 During the six months ended December 31, 2022, the Company had three major customers, one that represented 24 13 57 At December 31, 2023, one customer represented 92.8 Segments The Company operates in one segment, the mobile financial banking industry. In accordance with the “Segment Reporting” Topic of the ASC, the Company’s chief operating decision maker has been identified as the Chief Executive Officer and President, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Existing guidance, which is based on a management approach to segment reporting, establishes requirements to report selected segment information quarterly and to report annually entity-wide disclosures about products and services, major customers, and the countries in which the entity holds material assets and reports revenue. All material operating units qualify for aggregation under “Segment Reporting” due to their similar customer base and similarities in: economic characteristics; nature of products and services; and procurement, manufacturing and distribution processes. Since the Company operates in one segment, all financial information required by “Segment Reporting” can be found in the accompanying condensed consolidated financial statements. Recently Issued Accounting Standards In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06") “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40).” ASU 2020-06 reduces the number of accounting models for convertible debt instruments by eliminating the cash conversion and beneficial conversion models. The diluted net income per share calculation for convertible instruments will require the Company to use the if-converted method. For contracts in an entity’s own equity, the type of contracts primarily affected by this update are freestanding and embedded features that are accounted for as derivatives under the current guidance due to a failure to meet the settlement conditions of the derivative scope exception. This update simplifies the related settlement assessment by removing the requirements to (i) consider whether the contract would be settled in registered shares, (ii) consider whether collateral is required to be posted, and (iii) assess shareholder rights. ASU 2020-06 is effective January 1, 2024, for the Company and the provisions of this update can be adopted using either the modified retrospective method or a fully retrospective method. Early adoption is permitted, but no earlier than January 1, 2021, including interim periods within that year. The Company is currently assessing the impact of adopting this standard on the Company’s financial statements and related disclosures. Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the company’s present or future financial statements. |
CONTINGENT EARNOUT LIABILITY
CONTINGENT EARNOUT LIABILITY | 6 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
CONTINGENT EARNOUT LIABILITY | NOTE 2 – CONTINGENT EARNOUT LIABILITY On December 31, 2014, the Company acquired certain assets and liabilities of the Tangible Payments LLC. A portion of the purchase price for Tangible Payments LLC was an earnout payment of $ 155,000 1,300,000 |
CONVERTIBLE NOTES AND NOTES PAY
CONVERTIBLE NOTES AND NOTES PAYABLE | 6 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
CONVERTIBLE NOTES AND NOTES PAYABLE | NOTE 3 – CONVERTIBLE NOTES AND NOTES PAYABLE Convertible notes and notes payable Convertible notes and notes payable includes principal and accrued interest and consist of the following at December 31, 2023 and June 30, 2023: Convertible notes and notes payable - in default December 31, June 30, (a) Unsecured convertible notes ($21,000 and $21,000 in default) $ 67,000 $ 66,000 (b) Notes payable (in default) 484,000 475,000 (c) Notes payable (in default) 30,000 29,000 Total notes-third parties $ 581,000 $ 570,000 (a) The notes are unsecured, convertible into common stock at amounts ranging from $ 0.08 0.30 5 8 At June 30, 2023, convertible notes totaled $ 66,000 1,000 67,000 21,000 0.30 70,619 46,000 0.08 576,310 (b) The notes are either secured by the Company’s intellectual property or unsecured and bear interest ranging from 6.5 10 At June 30, 2023, the notes totaled $ 475,000 9,000 484,000 435,000 49,000 (c) The notes are unsecured and bear interest of 4 At June 30, 2023, the notes totaled $ 29,000 1,000 30,000 Convertible notes and notes payable-related parties Convertible and notes payable-related parties include principal and accrued interest and consist of the following at December 31, 2023 and June 30, 2023: Convertible notes and notes payable- related party December 31, June 30, (a) Convertible notes - The Matthews Group $ 2,027,000 $ 1,970,000 (b) Notes payable - The Matthews Group 5,331,000 4,988,000 (c) Convertible notes-other related parties ($244,000 and $242,000 in default) 520,000 364,000 Total notes-related parties $ 7,878,000 $ 7,322,000 (a) The notes are unsecured, convertible into common stock at $ 0.08 8 10 The Matthews Group is a related party (see Note 6) and is owned 50% by Ms. Van Tran, the Company’s CEO, and 50% by Larry Johanns, a significant shareholder of the Company. At June 30, 2023, convertible notes due to The Matthews Group totaled $ 1,970,000 . During the six months ended December 31, 2023, $ 57,000 of interest was added to principal, resulting in a balance payable at December 31, 2023 of $ 2,027,000 0.08 per share into 25,337,787 shares of the Company’s common stock. (b) The notes are unsecured, accrue interest at 10 % per annum, and are due on demand. The notes were issued relating to a management services agreement with The Matthews Group (see Note 6) dated September 30, 2015. At June 30, 2023, notes due to The Matthews Group totaled $ 4,988,000 154,000 189,000 5,331,000 (c) The notes are due to a current and a former director, are unsecured, convertible into common stock at per share amounts ranging from $ 0.04 to $ 0.30 , and bear interest at rates ranging from 8 % to 10 % per annum. At June 30, 2023, convertible notes due to other related parties totaled $ 364,000 145,000 11,000 520,000 247,000 273,000 247,000 0.30 814,581 93,000 0.09 1,099,847 180,000 0.04 4,507,292 |
STOCKHOLDERS_ DEFICIT
STOCKHOLDERS’ DEFICIT | 6 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
STOCKHOLDERS’ DEFICIT | NOTE 4 - STOCKHOLDERS’ DEFICIT Common Stock to be Issued At December 31, 2023 and June 30, 2023, 145,000 12,000 |
STOCK OPTIONS
STOCK OPTIONS | 6 Months Ended |
Dec. 31, 2023 | |
Stock Options | |
STOCK OPTIONS | NOTE 5 – STOCK OPTIONS A summary of stock options as of December 31, 2023 is as follows: Summary of Stock Options Number of Shares Weighted Average Exercise Price Outstanding at June 30, 2023 900,000 $ 0.03 Granted — — Forfeited (350,000 ) $ (0.03 ) Outstanding at December 31, 2023 550,000 $ 0.03 Exercisable at December 31, 2023 550,000 $ 0.03 As of December 31, 2023, the Company had no outstanding unvested options with future compensation costs. The outstanding and exercisable stock options had intrinsic value on December 31, 2023 of approximately $ 16,000 . Additional information regarding options outstanding as of December 31, 2023, is as follows: Additional information regarding outstanding options Options Outstanding and Exercisable at December 31, 2023 Exercise Price Number of Shares Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price $ 0.03 550,000 0.98 $ 0.03 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 6 – RELATED PARTY TRANSACTIONS The Matthews Group is owned 50 50 Management Services Agreement and Related Notes Payable with Related Party The Company’s Barcode Technology was invented by the founders of Veritec as a product identification system for identification and tracking of parts, components and products mostly in the liquid crystal display (LCD) markets and for secure identification documents, financial cards, medical records, and other high-security applications. On December 31, 2015, the Company sold all of its assets of its Barcode Technology comprised solely of its intellectual property to The Matthews Group. The Company then entered into a management services agreement with The Matthews Group to manage all facets of the barcode technology operations, on behalf of The Matthews Group, through June 30, 2024. The Matthews Group bears the risk of loss from the barcode operations and has the right to the residual benefits of the barcode operations. In consideration of the services provided by the Company to The Matthews Group, the Company earns a fee of 35 % of all revenues up to June 30, 2024, from the barcode technology operations. During the three and six months ended December 31, 2023 and 2022, the Company recorded management fee revenue related to this agreement of $ 54,000 91,000 37,000 and $ 81,000 Additionally, pursuant to the management services agreement, all cash flow (all revenues collected less direct costs paid) of the barcode technology operations is retained by the Company and reflected as proceeds from unsecured notes payable due The Matthews Group. During the six months ended December 31, 2023 and 2022, cash flow loans of $ 154,000 234,000 10 5,331,000 Advances from Related Parties From time to time, Ms. Tran, the Company’s CEO/Executive Chair, provides advances to finance the Company’s working capital requirements. As of December 31, 2023 and June 30, 2023, total advances from Ms. Tran amounted to $ 119,000 119,000 Other Transactions with Related Parties The Company leases its office facilities from Ms. Tran, the Company’s CEO/Executive Chair. For the three and six months ended December 31, 2023, lease payments to Ms. Tran totaled $ 13,000 and $ 26,000 , respectively. |
AGREEMENTS WITH NUGEN
AGREEMENTS WITH NUGEN | 6 Months Ended |
Dec. 31, 2023 | |
Agreements With Nugen | |
AGREEMENTS WITH NUGEN | NOTE 7 – AGREEMENTS WITH NUGEN On July 4, 2022, the Company entered a Memorandum of Understanding (the “MOU”) for the purpose of forming a strategic partnership between the Company and Nugen Universe, LLC (“Nugen”), a corporation located in Wrightsville Beach, North Carolina. Nugen seeks the Company to modify, create, or build a “private label” system for Nugen, with an initial interest in the Company’s blinxPay technology and Bio-ID verification system. Nugen paid the Company $ 50,000 On October 10, 2022, the Company entered into a License and Distributor Agreement (“License Agreement”) with Nugen. The License Agreement became effective on receipt of $ 200,000 200,000 200,000 200,000 |
LEGAL PROCEEDINGS
LEGAL PROCEEDINGS | 6 Months Ended |
Dec. 31, 2023 | |
Commitments and contingencies | |
LEGAL PROCEEDINGS | NOTE 8 – LEGAL PROCEEDINGS On September 21, 2016, the Company entered into a settlement agreement with an individual who was a former officer of the Company. The individual in prior years was also issued 500,000 shares of common stock for services. The Company alleged that the individual used the Company’s intellectual property without approval. Under the terms of the settlement agreement, the individual agreed to relinquish a convertible note payable and unpaid interest aggregating $ 365,000 500,000 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Dec. 31, 2023 | |
Commitments and contingencies | |
COMMITMENTS AND CONTINGENCIES | NOTE 9 – COMMITMENTS AND CONTINGENCIES On March 26, 2022, as amended on May 10, 2022, the Company and Es Solo Holdings Ltd (“Es Solo”), an England & Wales limited liability company, entered into a Prepaid Card Client Program Management Agreement (“Management Agreement”). Es Solo develops, markets, and operates prepaid card programs through its affiliations with issuing banks, and the Company desires to have Es Solo develop a prepaid card program to be marketed by the Company for card issuing purposes, pursuant to the terms of the Management Agreement. Es Solo agreed to pay the Company $ 10,000 no On November 1, 2021, the Company and Elite Web Technology Inc. (“Marketer”) entered into a Sales and Marketing Agreement (“Agreement”). The Company agreed that Marketer can market and sale certain Company products as defined in the Agreement. The Company agreed to pay Marketer a sales commission of 15 500,000 2 25,000 1.0 On December 5, 2008, the Company adopted an incentive compensation bonus plan to provide payments to key employees in the aggregated amount of 10 % of pre-tax earnings in excess of $ 3,000,000 after the end of each fiscal year to be distributed annually to employees. As of December 31, 2023, the Company had not achieved annual pre-tax earnings in excess of $3,000,000. On December 5, 2008, the Company entered into an employment agreement with Van Thuy Tran, its Chief Executive Officer, providing for an annual base salary of $ 150,000 and customary medical and other benefits. The agreement may be terminated by either party upon 30 days’ notice. In the event the Company terminates the agreement without cause, Ms. Tran will be entitled to $ 1,000,000 payable upon termination, and she will be entitled to severance equal to 12 months compensation and benefits. The Company has also agreed to indemnify Ms. Tran against any liability or damages incurred within the scope of her employment. During the six months ended December 31, 2023 and 2022, salaries paid to Van Thuy Tran under this agreement totaled $ 75,000 and $ 75,000 . |
OPERATIONS AND SUMMARY OF SIG_2
OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
The Company | The Company Veritec, Inc. (Veritec or the Company) was formed in the State of Nevada on September 8, 1982. Veritec is primarily engaged in the development, sales, and licensing of products and providing services related to its mobile banking solutions. As a Cardholder Independent Sales Organization, Veritec is able to promote and sell Visa-branded card programs. As a Third-Party Servicer, Veritec provides back-end cardholder transaction processing services for Visa-branded card programs on behalf of its sponsoring bank. Veritec has a portfolio of five United States and eight foreign patents. In addition, we have seven U.S. and twenty-eight foreign pending patent applications. Veritec has had agreements with various banks in the past and is currently seeking a bank to sponsor its Prepaid Card programs. On December 31, 2015, the Company sold all of its assets of its barcode technology, which was comprised solely of its intellectual property, to The Matthews Group, a related party (see Note 6). The Company subsequently entered into a management services agreement with The Matthews Group to manage all facets of the barcode technology operations through June 30, 2024. The Company earns a fee of 35% of all revenues billed up to December 31, 2023, and recognizes management fee revenue as services are performed. |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements condensed consolidated financial statements In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the period ended December 31 balances are consolidated financial statements The accompanying condensed consolidated financial statements |
Going Concern | Going Concern The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. During the period ended December 31, 2023, the Company incurred a net loss of $ 541,000 301,000 9,211,000 802,000 The Company believes it will require additional funds to continue its operations through fiscal 2024 and to continue to develop its existing projects and plans to raise such funds by finding additional investors to purchase the Company’s securities, generating sufficient sales revenue, implementing dramatic cost reductions or any combination thereof. There is no assurance that the Company can be successful in raising such funds, generating the necessary sales, or reducing major costs. Further, if the Company is successful in raising such funds from sales of equity securities, the terms of these sales may cause significant dilution to existing holders of common stock. The condensed consolidated financial statements do not include any adjustments that may result from this uncertainty. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Those estimates and assumptions include estimates for reserves of uncollectible accounts, accruals for potential liabilities, assumptions made in valuing stock instruments issued for services, and valuation of deferred tax assets. Actual results could differ from those estimates. |
Revenue Recognition | Revenue Recognition Revenues for the Company are classified into management fee revenue and mobile banking technology. The Company recognizes revenue in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASC 606"). The underlying principle of ASC 606 is to recognize revenue to depict the transfer of goods or services to customers at the amount expected to be collected. ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2) identifying the Company’s performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients. Mobile Banking Technology Revenue The Company, as a merchant payment processor and a distributor, recognizes revenue from transaction fees charged to cardholders for the use of its issued mobile debit cards. The fees are recognized on a monthly basis after all cardholder transactions have been summarized and reconciled with third party processors. Other Revenue, Management Fee – Related Party On December 31, 2015, the Company sold all of its assets of its Barcode Technology, which was comprised solely of its intellectual property, to The Matthews Group (a related party, see Note 6). The Company subsequently entered into a management services agreement with The Matthews Group to manage all facets of the barcode technology operations through June 30, 2024. The Company earned a fee of 35% of all revenues billed up to December 31, 2023. The Company recognizes management fee revenue as services are performed. Disaggregation of Net Sales The following table shows the Company’s disaggregated net sales by customer type: Disaggregate Net Sales Three Months Ended Six Months Ended 2023 2022 2023 2022 Medical $ 38,000 $ 14,000 $ 54,000 $ 28,000 Banking 8,000 ` 50,000 8,000 50,000 Associations 3,000 3,000 6,000 6,000 Education 4,000 3,000 6,000 6,000 Other revenue, management fee related party 54,000 37,000 91,000 118,000 Total revenue $ 107,000 $ 107,000 $ 165,000 $ 208,000 During the six months ended December 31, 2023 and 2022, all of the Company’s Mobile banking technology revenues were earned in the United States of America. Other revenue, management fee - related party revenue was $ 54,000 and $ 91,000 37,000 118,000 for the three and six months ended December 31, 2023 and 2022, respectively, and realized from our management services agreement with The Matthews Group, a related party, which requires us to manage The Matthews Group’s barcode technology operations. The Matthews Group’s barcode technology customers are primarily manufacturing companies located in China. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company determines the fair value of its assets and liabilities based on the exchange price in U.S. dollars that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. The Company uses a fair value hierarchy with three levels of inputs, of which the first two are considered observable and the last unobservable, to measure fair value: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Inputs, other than Level 1, that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The carrying amounts of financial instruments such as cash, accounts receivable, and accounts payable and accrued expenses, approximate the related fair values due to the short-term maturities of these instruments. The carrying values of convertible notes and notes payable approximate their fair values due to the fact that the interest rates on these obligations are based on prevailing market interest rates. |
Net Loss per Common Share | Net Loss per Common Share Basic earnings (loss) per share are computed by dividing the net income (loss) applicable to common stockholders by the weighted average number of shares of common stock outstanding during the year. Diluted earnings (loss) per share is computed by dividing the net income (loss) applicable to common stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued, using the treasury stock method. Potential common shares are excluded from the computation as their effect is antidilutive. For the period ended December 31, 2023 and 2022, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have an anti-dilutive effect. As of December 31, 2023, and 2022, we excluded the outstanding securities summarized below, which entitle the holders thereof to acquire shares of common stock, from our calculation of earnings per share, as their effect would have been anti-dilutive. Summary of securities excluded from EPS calculation As of December 31, 2023 2022 Series H Preferred Stock 10,000 10,000 Convertible Notes Payable 29,832,306 26,443,994 Options 550,000 900,000 Total 30,392,306 27,353,994 |
Concentrations | Concentrations During the three months ended December 31, 2023, the Company had one customer that represented 50 33 47 35 No other customer represented more than 10% of our revenues. During the six months ended December 31, 2023, the Company had one customer that represented 55 33 During the six months ended December 31, 2022, the Company had three major customers, one that represented 24 13 57 At December 31, 2023, one customer represented 92.8 |
Segments | Segments The Company operates in one segment, the mobile financial banking industry. In accordance with the “Segment Reporting” Topic of the ASC, the Company’s chief operating decision maker has been identified as the Chief Executive Officer and President, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Existing guidance, which is based on a management approach to segment reporting, establishes requirements to report selected segment information quarterly and to report annually entity-wide disclosures about products and services, major customers, and the countries in which the entity holds material assets and reports revenue. All material operating units qualify for aggregation under “Segment Reporting” due to their similar customer base and similarities in: economic characteristics; nature of products and services; and procurement, manufacturing and distribution processes. Since the Company operates in one segment, all financial information required by “Segment Reporting” can be found in the accompanying condensed consolidated financial statements. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06") “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40).” ASU 2020-06 reduces the number of accounting models for convertible debt instruments by eliminating the cash conversion and beneficial conversion models. The diluted net income per share calculation for convertible instruments will require the Company to use the if-converted method. For contracts in an entity’s own equity, the type of contracts primarily affected by this update are freestanding and embedded features that are accounted for as derivatives under the current guidance due to a failure to meet the settlement conditions of the derivative scope exception. This update simplifies the related settlement assessment by removing the requirements to (i) consider whether the contract would be settled in registered shares, (ii) consider whether collateral is required to be posted, and (iii) assess shareholder rights. ASU 2020-06 is effective January 1, 2024, for the Company and the provisions of this update can be adopted using either the modified retrospective method or a fully retrospective method. Early adoption is permitted, but no earlier than January 1, 2021, including interim periods within that year. The Company is currently assessing the impact of adopting this standard on the Company’s financial statements and related disclosures. Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the company’s present or future financial statements. |
OPERATIONS AND SUMMARY OF SIG_3
OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Disaggregate Net Sales | Disaggregate Net Sales Three Months Ended Six Months Ended 2023 2022 2023 2022 Medical $ 38,000 $ 14,000 $ 54,000 $ 28,000 Banking 8,000 ` 50,000 8,000 50,000 Associations 3,000 3,000 6,000 6,000 Education 4,000 3,000 6,000 6,000 Other revenue, management fee related party 54,000 37,000 91,000 118,000 Total revenue $ 107,000 $ 107,000 $ 165,000 $ 208,000 |
Summary of securities excluded from EPS calculation | Summary of securities excluded from EPS calculation As of December 31, 2023 2022 Series H Preferred Stock 10,000 10,000 Convertible Notes Payable 29,832,306 26,443,994 Options 550,000 900,000 Total 30,392,306 27,353,994 |
CONVERTIBLE NOTES AND NOTES P_2
CONVERTIBLE NOTES AND NOTES PAYABLE (Tables) | 6 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Convertible notes and notes payable - in default | Convertible notes and notes payable - in default December 31, June 30, (a) Unsecured convertible notes ($21,000 and $21,000 in default) $ 67,000 $ 66,000 (b) Notes payable (in default) 484,000 475,000 (c) Notes payable (in default) 30,000 29,000 Total notes-third parties $ 581,000 $ 570,000 |
Convertible notes and notes payable- related party | Convertible notes and notes payable- related party December 31, June 30, (a) Convertible notes - The Matthews Group $ 2,027,000 $ 1,970,000 (b) Notes payable - The Matthews Group 5,331,000 4,988,000 (c) Convertible notes-other related parties ($244,000 and $242,000 in default) 520,000 364,000 Total notes-related parties $ 7,878,000 $ 7,322,000 |
STOCK OPTIONS (Tables)
STOCK OPTIONS (Tables) | 6 Months Ended |
Dec. 31, 2023 | |
Stock Options | |
Summary of Stock Options | Summary of Stock Options Number of Shares Weighted Average Exercise Price Outstanding at June 30, 2023 900,000 $ 0.03 Granted — — Forfeited (350,000 ) $ (0.03 ) Outstanding at December 31, 2023 550,000 $ 0.03 Exercisable at December 31, 2023 550,000 $ 0.03 |
Additional information regarding outstanding options | Additional information regarding outstanding options Options Outstanding and Exercisable at December 31, 2023 Exercise Price Number of Shares Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price $ 0.03 550,000 0.98 $ 0.03 |
OPERATIONS AND SUMMARY OF SIG_4
OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Summary of Disaggregated Net Sales (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Product Information [Line Items] | ||||
Total revenue | $ 107,000 | $ 107,000 | $ 165,000 | $ 208,000 |
Medical [Member] | ||||
Product Information [Line Items] | ||||
Total revenue | 38,000 | 14,000 | 54,000 | 28,000 |
Banking [Member] | ||||
Product Information [Line Items] | ||||
Total revenue | 8,000 | 50,000 | 8,000 | 50,000 |
Associations [Member] | ||||
Product Information [Line Items] | ||||
Total revenue | 3,000 | 3,000 | 6,000 | 6,000 |
Education [Member] | ||||
Product Information [Line Items] | ||||
Total revenue | 4,000 | 3,000 | 6,000 | 6,000 |
Other [Member] | ||||
Product Information [Line Items] | ||||
Total revenue | $ 54,000 | $ 37,000 | $ 91,000 | $ 118,000 |
OPERATIONS AND SUMMARY OF SIG_5
OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Summarized outstanding securities (Details) - shares | 6 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 30,392,306 | 27,353,994 |
Series H Preferred Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 10,000 | 10,000 |
Convertible Notes Payable [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 29,832,306 | 26,443,994 |
Options Held [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 550,000 | 900,000 |
OPERATIONS AND SUMMARY OF SIG_6
OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||||||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2023 | Jun. 30, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | |
Product Information [Line Items] | ||||||||
Net loss | $ 235,000 | $ 272,000 | $ 541,000 | $ 583,000 | ||||
Cash used in operating activities | 301,000 | 117,000 | ||||||
Stockholders' deficit | 9,211,000 | 8,019,000 | 9,211,000 | 8,019,000 | $ 8,976,000 | $ 8,670,000 | $ 7,747,000 | $ 7,436,000 |
Notes payable in default | 802,000 | 802,000 | ||||||
[custom:RevenueRelatedParties] | $ 54,000 | $ 37,000 | $ 91,000 | $ 118,000 | ||||
Revenue, Segment Benchmark [Member] | Customer One [Member] | ||||||||
Product Information [Line Items] | ||||||||
Concentration Risk, Percentage | 50% | 47% | 55% | 24% | ||||
Revenue, Segment Benchmark [Member] | Customer Two [Member] | ||||||||
Product Information [Line Items] | ||||||||
Concentration Risk, Percentage | 33% | 35% | 33% | 13% | ||||
Revenue, Segment Benchmark [Member] | Customer Three [Member] | ||||||||
Product Information [Line Items] | ||||||||
Concentration Risk, Percentage | 57% | |||||||
Accounts Receivable [Member] | Customer One [Member] | ||||||||
Product Information [Line Items] | ||||||||
Concentration Risk, Percentage | 92.80% |
CONTINGENT EARNOUT LIABILITY (D
CONTINGENT EARNOUT LIABILITY (Details Narrative) - Acquisition Assets Liabilities [Member] - USD ($) | Oct. 02, 2014 | Oct. 01, 2014 |
Finite-Lived Intangible Assets [Line Items] | ||
Earnout Payment | $ 155,000 | |
Equity investments | $ 1,300,000 |
CONVERTIBLE NOTES AND NOTES P_3
CONVERTIBLE NOTES AND NOTES PAYABLE - Convertible notes and notes payable in default (Details) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Debt Disclosure [Abstract] | ||
(a) Unsecured convertible notes ($21,000 and $21,000 in default) | $ 67,000 | $ 66,000 |
(b) Notes payable (in default) | 484,000 | 475,000 |
(c) Notes payable (in default) | 30,000 | 29,000 |
Total notes-third parties | $ 581,000 | $ 570,000 |
CONVERTIBLE NOTES AND NOTES P_4
CONVERTIBLE NOTES AND NOTES PAYABLE - Convertible notes and notes payable related party (Details) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Defined Benefit Plan Disclosure [Line Items] | ||
Convertible Notes, Related Party | $ 520,000 | |
Notes Payable Related Party | 7,878,000 | $ 7,322,000 |
Matthews Group [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Convertible Notes, Related Party | 2,027,000 | 1,970,000 |
Notes Payable Related Party | 5,331,000 | 4,988,000 |
Other [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Convertible Notes, Related Party | $ 520,000 | $ 364,000 |
CONVERTIBLE NOTES AND NOTES P_5
CONVERTIBLE NOTES AND NOTES PAYABLE (Details Narrative) - USD ($) | 6 Months Ended | ||
Dec. 31, 2023 | Jun. 30, 2023 | Mar. 17, 2020 | |
Debt Instrument [Line Items] | |||
Conversion price | $ 0.08 | ||
Notes Payable | $ 30,000 | $ 29,000 | |
Convertible Notes Payable, Current | 520,000 | ||
Increase (Decrease) in Notes Payable, Current | 145,000 | ||
Convertible notes and notes payable, related party, in default | 247,000 | 242,000 | |
[custom:NotesPayableDueOnDemand-0] | 273,000 | ||
Other [Member] | |||
Debt Instrument [Line Items] | |||
Convertible Notes Payable, Current | $ 520,000 | 364,000 | |
Matthews Group [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 10% | ||
Convertible Notes Payable, Current | $ 2,027,000 | 1,970,000 | |
Unsecured Convertible Notes [Member] | |||
Debt Instrument [Line Items] | |||
Convertible debts | 67,000 | 66,000 | |
Accrued interest | 1,000 | ||
Notes in Default | 21,000 | ||
Balance due on demand | $ 46,000 | ||
Unsecured Convertible Notes [Member] | Common Stock [Member] | |||
Debt Instrument [Line Items] | |||
Conversion price | $ 0.30 | ||
Unsecured Convertible Note [Member] | |||
Debt Instrument [Line Items] | |||
Shares issued upon conversion | 576,310 | ||
Unsecured Convertible Note [Member] | Common Stock [Member] | |||
Debt Instrument [Line Items] | |||
Shares issued upon conversion | 70,619 | ||
Notes Payable Default [Member] | |||
Debt Instrument [Line Items] | |||
Notes payable | 475,000 | ||
Notes Payables Default [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 4% | ||
Accrued interest | $ 9,000 | ||
Notes payable | 484,000 | ||
Secured Notes [Member] | |||
Debt Instrument [Line Items] | |||
Notes payable | 435,000 | ||
Unsecured Notes [Member] | |||
Debt Instrument [Line Items] | |||
Notes payable | $ 49,000 | ||
Convertible Notes [Member] | |||
Debt Instrument [Line Items] | |||
Conversion price | $ 0.08 | ||
Accrued interest | $ 1,000 | ||
Convertible Notes [Member] | Other [Member] | |||
Debt Instrument [Line Items] | |||
Conversion price | $ 0.30 | ||
Convertible debts | 364,000 | ||
Accrued interest | $ 11,000 | ||
Shares issued upon conversion | 814,581 | ||
Increase (Decrease) in Notes Payable, Current | $ 247,000 | ||
Convertible Notes [Member] | Matthews Group [Member] | |||
Debt Instrument [Line Items] | |||
Convertible debts | 1,970,000 | ||
Accrued interest | $ 57,000 | ||
Shares issued upon conversion | 25,337,787 | ||
Convertible Notes [Member] | Other 2 [Member] | |||
Debt Instrument [Line Items] | |||
Balance due on demand | $ 93,000 | ||
Convertible Notes [Member] | Other 3 [Member] | |||
Debt Instrument [Line Items] | |||
Balance due on demand | $ 180,000 | ||
Convertible Note [Member] | Other [Member] | |||
Debt Instrument [Line Items] | |||
Conversion price | $ 0.08 | ||
Convertible Note [Member] | Other 2 [Member] | |||
Debt Instrument [Line Items] | |||
Conversion price | $ 0.09 | ||
Shares issued upon conversion | 1,099,847 | ||
Convertible Note [Member] | Other 3 [Member] | |||
Debt Instrument [Line Items] | |||
Conversion price | $ 0.04 | ||
Shares issued upon conversion | 4,507,292 | ||
Notes Payable [Member] | Matthews Group [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 10% | ||
Accrued interest | $ 189,000 | ||
Notes payable | 5,331,000 | $ 4,988,000 | |
Increase (Decrease) in Notes Payable, Current | $ 154,000 | ||
Minimum [Member] | Matthews Group [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 8% | ||
Minimum [Member] | Unsecured Convertible Notes [Member] | |||
Debt Instrument [Line Items] | |||
Conversion price | $ 0.08 | ||
Interest rate | 5% | ||
Minimum [Member] | Notes Payable Default [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 6.50% | ||
Minimum [Member] | Convertible Notes [Member] | Other [Member] | |||
Debt Instrument [Line Items] | |||
Conversion price | $ 0.04 | ||
Interest rate | 8% | ||
Maximum [Member] | Matthews Group [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 1,000% | ||
Maximum [Member] | Unsecured Convertible Notes [Member] | |||
Debt Instrument [Line Items] | |||
Conversion price | $ 0.30 | ||
Interest rate | 8% | ||
Maximum [Member] | Notes Payable Default [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 10% | ||
Maximum [Member] | Convertible Notes [Member] | Other [Member] | |||
Debt Instrument [Line Items] | |||
Conversion price | $ 0.30 | ||
Interest rate | 10% |
STOCKHOLDERS_ DEFICIT (Details
STOCKHOLDERS’ DEFICIT (Details Narrative) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Equity [Abstract] | ||
Common stock to be issued | 145,000 | 145,000 |
Common stock to be issued, value | $ 12,000 | $ 12,000 |
STOCK OPTIONS - Summary of Stoc
STOCK OPTIONS - Summary of Stock Options (Details) | 6 Months Ended |
Dec. 31, 2023 $ / shares shares | |
Stock Options | |
Number of Shares outstanding at beginning | shares | 900,000 |
Beginning weighted average exercise price, outstanding | $ / shares | $ 0.03 |
Options Granted | shares | 0 |
Options granted, weighted average exercise price | $ / shares | $ 0 |
Options Expired | shares | (350,000) |
Options Expired, weighted average exercise price | $ / shares | $ (0.03) |
Number of Shares outstanding at end | shares | 550,000 |
Ending weighted average exercise price, outstanding | $ / shares | $ 0.03 |
Options, Exercisable | shares | 550,000 |
Weighted average exercise price, exercisable | $ / shares | $ 0.03 |
STOCK OPTIONS - Additional info
STOCK OPTIONS - Additional information regarding outstanding options (Details) - $ / shares | 6 Months Ended | |
Dec. 31, 2023 | Jun. 30, 2023 | |
Debt Conversion [Line Items] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Weighted Average Exercise Price | $ 0.03 | |
Options outstanding, shares | 550,000 | 900,000 |
Weighted average exercise price | $ 0.03 | $ 0.03 |
Conversion Price 03 [Member] | ||
Debt Conversion [Line Items] | ||
Options outstanding, shares | 550,000 | |
Weighted average remaining contractual life (years) | 11 months 23 days | |
Weighted average exercise price | $ 0.03 |
STOCK OPTIONS (Details Narrativ
STOCK OPTIONS (Details Narrative) | Dec. 31, 2023 USD ($) |
Stock Options | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Vested and Expected to Vest, Outstanding, Aggregate Intrinsic Value | $ 0 |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Intrinsic Value | $ 16,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Jun. 30, 2023 | |
Related Party Transaction [Line Items] | |||||
Managament fee, percent of revenue | 35% | ||||
[custom:FeeRevenue] | $ 54,000 | $ 91,000 | $ 37,000 | $ 81,000 | |
Proceeds from notes payable - related party | 299,000 | 234,000 | |||
Notes Payable Related Party | 7,878,000 | 7,878,000 | $ 7,322,000 | ||
Chief Executive Officer [Member] | |||||
Related Party Transaction [Line Items] | |||||
Advances due to related party | 119,000 | 119,000 | 119,000 | ||
Payments for Rent | $ 13,000 | 26,000 | |||
Matthews Group [Member] | |||||
Related Party Transaction [Line Items] | |||||
Proceeds from notes payable - related party | $ 154,000 | $ 234,000 | |||
Unsecured related party note, interest | 10% | 10% | |||
Notes Payable Related Party | $ 5,331,000 | $ 5,331,000 | $ 4,988,000 | ||
Tran [Member] | |||||
Related Party Transaction [Line Items] | |||||
Ownership of TMG | 50% | 50% | |||
Stockholder [Member] | |||||
Related Party Transaction [Line Items] | |||||
Ownership of TMG | 50% | 50% |
AGREEMENTS WITH NUGEN (Details
AGREEMENTS WITH NUGEN (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Jun. 30, 2023 | |
Revenues, Net of Interest Expense | $ 107,000 | $ 107,000 | $ 165,000 | $ 208,000 | |
Deferred Revenue, Noncurrent | 200,000 | 200,000 | $ 200,000 | ||
Banking [Member] | |||||
Revenues, Net of Interest Expense | $ 8,000 | $ 50,000 | $ 8,000 | $ 50,000 |
LEGAL PROCEEDINGS (Details Narr
LEGAL PROCEEDINGS (Details Narrative) | Sep. 21, 2016 USD ($) shares |
Commitments and contingencies | |
Convertible note payable relinquished | $ | $ 365,000 |
Shares to be returned | shares | 500,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | 18 Months Ended | |||||
May 10, 2022 | Nov. 02, 2021 | Dec. 05, 2008 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Program setup fee | $ 10,000 | |||||||
Revenues | $ 107,000 | $ 107,000 | $ 165,000 | $ 208,000 | ||||
Sales commissions | 15% | |||||||
Number of shares issued | 500,000 | |||||||
Stock recevied on transaction | $ 2,000,000 | |||||||
Incentive compensation plan percentage | 10% | |||||||
Incentive Compensation Bonus, Minimum Threshold | $ 3,000,000 | |||||||
Termination Loans | 1,000,000 | |||||||
Payments to Employees | 75,000 | $ 75,000 | ||||||
Chief Executive Officer [Member] | ||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Annual base salary | $ 150,000 | |||||||
Equity Option [Member] | ||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Number of shares issued | 25,000 | |||||||
Stock recevied on transaction | $ 1,000,000 | |||||||
Management Agreement [Member] | ||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Revenues | $ 0 |