Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Jun. 30, 2020 | Jul. 31, 2020 | |
Document and Entity Information | ||
Entity Registrant Name | ENCISION INC | |
Entity Central Index Key | 0000930775 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --03-31 | |
Entity's Reporting Status Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Shell company | false | |
Entity File Number | 001-11789 | |
Entity Incorporation, State Country Code | CO | |
Entity Interactive Data Current | Yes | |
Entity Common Stock, Shares Outstanding | 11,582,641 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 |
Condensed Balance Sheets (Unaud
Condensed Balance Sheets (Unaudited) - USD ($) | Jun. 30, 2020 | Mar. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 628,419 | $ 385,132 |
Accounts receivable, net of allowance for doubtful accounts of $45,000 at June 30, 2020 and $58,000 at March 31, 2020 | 796,955 | 881,194 |
Inventories, net of reserve for obsolescence of $53,000 at June 30, 2020 and $39,000 at March 31, 2020 | 1,708,357 | 1,625,901 |
Prepaid expenses | 111,447 | 72,639 |
Total current assets | 3,245,178 | 2,964,866 |
Equipment, at cost: | ||
Furniture, fixtures and equipment | 3,130,640 | 3,130,640 |
Accumulated depreciation | (2,941,900) | (2,923,482) |
Equipment, net | 188,740 | 207,158 |
Right of use asset | 1,257,390 | 1,317,057 |
Patents, net of accumulated amortization of $298,703 at June 30, 2020 and $291,337 at March 31, 2020 | 225,264 | 228,296 |
Other assets | 20,497 | 19,548 |
TOTAL ASSETS | 4,937,069 | 4,736,925 |
Current liabilities: | ||
Accounts payable | 392,648 | 444,823 |
Line of credit | 183,957 | 370,498 |
Accrued compensation | 204,794 | 218,806 |
Other accrued liabilities | 121,383 | 96,077 |
Accrued lease liability | 225,614 | 278,271 |
Total current liabilities | 1,128,396 | 1,408,475 |
Long-term liability: | ||
Accrued lease liability, net of current portion | 1,157,859 | 1,144,432 |
Unsecured promissory note | 598,567 | 0 |
Total liabilities | 2,884,822 | 2,552,907 |
Shareholders' equity: | ||
Preferred stock, no par value: 10,000,000 shares authorized; none issued and outstanding | 0 | 0 |
Common stock and additional paid-in capital, no par value: 100,000,000 shares authorized; 11,582,641 shares issued and outstanding at June 30, 2020 and March 31, 2020 | 24,240,011 | 24,232,477 |
Accumulated (deficit) | (22,187,764) | (22,048,459) |
Total shareholders' equity | 2,052,247 | 2,184,018 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 4,937,069 | $ 4,736,925 |
Condensed Balance Sheets (Una_2
Condensed Balance Sheets (Unaudited) (Parenthetical) - USD ($) | Jun. 30, 2020 | Mar. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts (in dollars) | $ 45,000 | $ 58,000 |
Inventories, reserve for obsolescence (in dollars) | 53,000 | 39,000 |
Accumulated amortization | $ 298,703 | $ 291,337 |
Preferred stock, par value | $ 0 | $ 0 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock and additional paid-in capital, par value | $ 0 | $ 0 |
Common stock and additional paid-in capital, shares authorized | 100,000,000 | 100,000,000 |
Common stock and additional paid-in capital, shares issued | 11,582,641 | 11,582,641 |
Common stock and additional paid-in capital, shares outstanding | 11,582,641 | 11,582,641 |
Condensed Statements of Operati
Condensed Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Income Statement [Abstract] | ||
NET REVENUE | $ 1,347,567 | $ 1,928,575 |
COST OF REVENUE | 700,693 | 995,604 |
GROSS PROFIT | 646,874 | 932,971 |
OPERATING EXPENSES: | ||
Sales and marketing | 367,648 | 530,505 |
General and administrative | 287,082 | 345,600 |
Research and development | 141,607 | 236,144 |
Total operating expenses | 796,337 | 1,112,249 |
OPERATING (LOSS) | (149,463) | (179,278) |
Interest expense, net | (17,483) | (2,783) |
Other income, net | 27,641 | 167 |
Interest expense and other income, net | 10,158 | (2,616) |
(LOSS) BEFORE PROVISION FOR INCOME TAXES | (139,305) | (181,894) |
Provision for income taxes | 0 | 0 |
NET LOSS | $ (139,305) | $ (181,894) |
Net loss per share - basic and Diluted | $ (0.01) | $ (0.02) |
Weighted average shares - basic and Diluted | 11,582,641 | 11,558,355 |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Operating activities: | ||
Net (loss) | $ (139,305) | $ (181,894) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 25,784 | 42,832 |
Share-based compensation expense | 7,534 | 7,702 |
Provision for (recovery from) doubtful accounts, net | (13,000) | (6,000) |
Provision for (recovery from) inventory obsolescence, net | 14,000 | (10,000) |
Changes in operating assets and liabilities: | ||
Right of use asset, net | 20,437 | (23,256) |
Accounts receivable | 97,239 | (6,235) |
Inventories | (96,456) | 104,824 |
Prepaid expenses and other assets | (39,757) | (2,567) |
Accounts payable | (52,175) | (141,038) |
Accrued compensation and other accrued liabilities | 11,294 | (75,356) |
Net cash generated by (used in) operating activities | (164,405) | (290,988) |
Investing activities: | ||
Acquisition of property and equipment | 0 | (20,986) |
Patent costs | (4,334) | (805) |
Net cash (used in) investing activities | (4,334) | (21,791) |
Financing activities: | ||
(Paydowns of) borrowings from credit facility, net change | (186,541) | 150,000 |
Unsecured promissory note | 598,567 | 0 |
Net cash generated by financing activities | 412,026 | 150,000 |
Net increase (decrease) in cash and cash equivalents | 243,287 | (162,779) |
Cash and cash equivalents, beginning of period | 385,132 | 298,348 |
Cash and cash equivalents, end of period | 628,419 | 135,569 |
Supplemental disclosure: | ||
Right of use asset | 1,257,390 | 1,214,983 |
Accrued lease liability | 1,383,473 | 1,279,675 |
Interest paid | $ 17,483 | $ 2,783 |
ORGANIZATION AND NATURE OF BUSI
ORGANIZATION AND NATURE OF BUSINESS | 3 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND NATURE OF BUSINESS | Note 1. ORGANIZATION AND NATURE OF BUSINESS Encision Inc. is a medical device company that designs, develops, manufactures and markets patented surgical instruments that provide greater safety to, and saves lives of, patients undergoing minimally-invasive surgery. We believe that our patented AEM ® We have an accumulated deficit of $22,187,764 at June 30, 2020. A significant portion of our operating funds have been provided by issuances of our common stock and warrants, a line of credit, and the exercise of stock options to purchase our common stock. Shareholders’ equity decreased by $131,771 as a result of our loss of $139,305, and increased as a result of share-based compensation of $7,534. Should our liquidity be diminished in the future because of operating losses, we may be required to seek additional capital. Our strategic marketing and sales plan is designed to expand the use of our products in surgically active hospitals and surgery centers in the United States. We have been actively monitoring the novel coronavirus (“COVID-19”) situation and its impact globally. Our production facilities continued to operate during the year as they had prior to the COVID-19 pandemic with minimal change, other than for enhanced safety measures intended to prevent the spread of the virus. The remote working arrangements and travel restrictions imposed by various governments had limited impact on our ability to maintain operations during the year, as our manufacturing operations have generally been exempted from stay-at-home orders. Revenue for April, May and June of 2020 decreased 50%, 33% and 8%, respectively. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation. The accompanying condensed interim financial statements have been prepared, in all material respects, in conformity with the standards of accounting measurements and reflect, in the opinion of management, all adjustments necessary to summarize fairly the financial position and results of operations for such periods in accordance with GAAP. All adjustments are of a normal recurring nature. The results of operations for the most recent interim period are not necessarily indicative of the results to be expected for the full year. Use of Estimates in the Preparation of Financial Statements. Cash and Cash Equivalents. Fair Value of Financial Instruments. Concentration of Credit Risk. We have no significant off-balance sheet concentrations of credit risk such as foreign exchange contracts, options contracts or other foreign hedging arrangements. We maintain the majority of our cash balances with one financial institution in the form of demand deposits. Accounts receivable are typically unsecured and are derived from transactions with and from entities in the healthcare industry primarily located in the United States. Accordingly, we may be exposed to credit risk generally associated with the healthcare industry. We maintain allowances for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments. The net accounts receivable balance at June 30, 2020 of $796,955 and at March 31, 2020 of $881,194 included no more than 8% from any one customer. Inventories June 30, 2020 March 31, 2020 Raw materials $ 1,413,140 $ 1,147,983 Finished goods 348,217 516,918 Total gross inventories 1,761,357 1,664,901 Less reserve for obsolescence (53,000 ) (39,000 ) Total net inventories $ 1,708,357 $ 1,625,901 Property and Equipment Long-Lived Assets. Patents. Income Taxes. Revenue Recognition. Research and Development Expenses Stock-Based Compensation Stock-based compensation expense recognized under ASC 718 for the three months ended June 30, 2020 and 2019 was $7,534 and $7,702, respectively, which consisted of stock-based compensation expense related to grants of employee stock options. Segment Reporting. Recent Accounting Pronouncements. ASU No. 2014-09 (ASC 606), Revenue from Contracts with Customers became effective for us beginning April 1, 2018, and we adopted the new accounting standard using the modified retrospective transition approach. We record revenue under ASC 606 at a single point in time, when control is transferred to the customer, which is consistent with past practice. We will continue to apply our current business processes, policies, systems and controls to support recognition and disclosure under the new standard. Based on the results of the evaluation, we have determined that the adoption of the new standard presents no material impact on our financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) ("ASU 2016-02"), which modified lease accounting for both lessees and lessors to increase transparency and comparability by recognizing lease assets and lease liabilities by lessees for those leases classified as operating leases under previous accounting standards and disclosing key information about leasing arrangements. Within the opening balances for the fiscal year beginning April 1, 2019, we recognized leased assets and leased liabilities in other long-term assets of $1,555,150 and long-term liabilities of $1,619,842 (see Note 4). |
BASIC AND DILUTED INCOME AND LO
BASIC AND DILUTED INCOME AND LOSS PER COMMON SHARE | 3 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
BASIC AND DILUTED INCOME AND LOSS PER COMMON SHARE | Note 3. Basic and Diluted Income and Loss per Common Share We report both basic and diluted net income (loss) per share. Basic net income or loss per common share is computed by dividing net income or loss for the period by the weighted average number of common shares outstanding for the period. Diluted net income or loss per common share is computed by dividing the net income or loss for the period by the weighted average number of common and potential common shares outstanding during the period if the effect of the potential common shares is dilutive. The shares used in the calculation of dilutive potential common shares exclude options to purchase shares where the exercise price was greater than the average market price of common shares for the period. The following table presents the calculation of basic and diluted net loss per share: Three Months Ended June 30, 2020 June 30, 2019 Net (loss) $ (139,305 ) $ (181,894 ) Weighted-average shares — basic 11,582,641 11,558,355 Effect of dilutive potential common shares — — Weighted-average shares — diluted 11,582,641 11,558,355 Net (loss) per share — basic $ (0.01 ) $ (0.02 ) Net (loss) per share — diluted $ (0.01 ) $ (0.02 ) Antidilutive employee stock options and RSUs 1,018,000 980,286 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | Note 4. COMMITMENTS AND CONTINGENCIES We have a noncancelable lease agreement for our facilities at 6797 Winchester Circle, Boulder, Colorado. The lease expires October 31, 2024. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) ("ASU 2016-02"), which modified lease accounting for both lessees and lessors to increase transparency and comparability by recognizing lease assets and lease liabilities by lessees for those leases classified as either finance or operating leases under previous accounting standards and disclosing key information about leasing arrangements. We adopted Topic 842 on April 1, 2019, using the alternative modified transition method, which requires a cumulative effect adjustment, if any, to the opening balance of retained earnings to be recognized on the date of adoption with prior periods not restated. There was no cumulative effect adjustment recorded on April 1, 2019. The primary impact for us was the balance sheet recognition of right-of-use (“ROU”) assets and lease liabilities for operating leases as a lessee. We determine if an arrangement contains a lease at inception. We currently do not have any finance leases. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. ROU assets also include any initial direct costs incurred and any lease payments made at or before the lease commencement date, less lease incentives received. We use our incremental borrowing rate based on the information available at the commencement date in determining the lease liabilities as our leases do not provide an implicit rate. Lease expense is recognized on a straight-line basis over the lease term. The minimum future lease payment, by fiscal year, as of June 30, 2020 is as follows: Fiscal Year Amount 2021 259,792 2022 357,667 2023 372,167 2024 386,667 2025 232,139 Total $ 1,608,432 On August 9, 2019, we entered into a loan and security agreement with Crestmark Bank. The loan is due on demand, has no financial covenants and is secured by all of our assets. Under the agreement, we were provided with a line of credit that is not to exceed the lesser of $1,000,000 or 85% of eligible accounts receivable. The interest rate is prime rate (3.25% at June 30, 2020) plus 1.5%, with a floor of 6.75%, plus a monthly maintenance fee of 0.4%, based on the average monthly loan balance. Interest is charged on a minimum loan balance of $500,000, a loan fee of 1% annually, and an exit fee of 3%, 2% and 1% during years one, two and three, respectively. On April 17, 2020, we entered into an unsecured promissory note under the Paycheck Protection Program (the “PPP”) for a principal amount of $598,567. The PPP was established under the recently congressionally approved Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). The term of the PPP loan is for five years with an interest rate of 1.0% per year, which will be deferred for the first six months of the term of the loan. After the initial six-month deferral period, the loan requires monthly payments of principal and interest until maturity with respect to any portion of the PPP loan which is not forgiven. Under the terms of the CARES Act, a PPP loan recipient may apply for, and be granted, forgiveness for all or a portion of loans granted under the PPP. Such forgiveness will be determined based upon the use of loan proceeds for payroll costs, rent and utility costs, and the maintenance of employee and compensation levels. In the quarter that ends September 30, 2020, we will apply for loan forgiveness and, since we achieved the requirements for forgiveness, we believe that all of the $598,567 will be forgiven. Aside from the operating lease, we do not have any material contractual commitments requiring settlement in the future. We are subject to regulation by the United States Food and Drug Administration (“FDA”). The FDA provides regulations governing the manufacture and sale of our products and regularly inspects us and other manufacturers to determine compliance with these regulations. We believe that we were in substantial compliance with all known regulations at June 30, 2020. FDA inspections are conducted periodically at the discretion of the FDA. Our latest inspection by the FDA occurred in October 2019. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 3 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
SHARE-BASED COMPENSATION | Note 5. SHARE-BASED COMPENSATION The provisions of ASC 718-10-55 requires the measurement and recognition of compensation expense for all share-based payment awards made to our employees and directors, including employee stock options and RSUs, based on estimated fair values. The following table summarizes stock-based compensation expense related to employee stock options for the three months ended June 30, 2020 and 2019, which was allocated as follows: Three Months Ended June 30, 2020 June 30, 2019 Cost of sales $ 718 $ 681 Sales and marketing 1,158 790 General and administrative 5,172 5,622 Research and development 486 609 Stock-based compensation expense $ 7,534 $ 7,702 Share-based compensation cost for stock options is measured at the grant date, based on the fair value as calculated by the Black-Scholes-Merton ("BSM") option-pricing model. The BSM option-pricing model requires the use of actual employee exercise behavior data and the application of a number of assumptions, including expected volatility, risk-free interest rate and expected dividends. There were 20,000 stock options granted and no stock options forfeited during the three months ended June 30, 2020, and 40,000 stock options granted and 50,000 stock options forfeited during the three months ended June 30, 2019. As of June 30, 2020, approximately $81,000 of total unrecognized compensation costs related to nonvested stock options is expected to be recognized over a period of five years. |
RELATED PARTY TRANSACTION
RELATED PARTY TRANSACTION | 3 Months Ended |
Jun. 30, 2020 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTION | Note 6. RELATED PARTY TRANSACTION We paid consulting fees of $14,603 and $20,094 to an entity owned by one of our directors during the three months ended June 30, 2020 and 2019, respectively. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Jun. 30, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | Note 7. SUBSEQUENT EVENTS Except for the item that follows, we evaluated all of our activity as of the date the condensed interim financial statements were issued and concluded that no subsequent events have occurred that would require recognition in our financial statements or disclosed in the notes to our condensed interim financial statements. On August 4, we received $150,000 in loan funding from the U.S. Small Business Administration (“SBA”) under the Economic Injury Disaster Loan (“EIDL”) program administered by the SBA, which program was expanded pursuant to the CARES Act. The EIDL is evidenced by a promissory note, dated August 1 in the original principal amount of $150,000 with the SBA, the lender. Under the terms of the Note, interest accrues on the outstanding principal at the rate of 3.75% per annum. The term of the Note is thirty years, though it may be payable sooner upon an event of default under the Note. Under the Note, the Company will be obligated to make equal monthly payments of principal and interest beginning on August 1, 2021 through the maturity date of August 1, 2051. The Note may be prepaid in part or in full, at any time, without penalty. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation. The accompanying condensed interim financial statements have been prepared, in all material respects, in conformity with the standards of accounting measurements and reflect, in the opinion of management, all adjustments necessary to summarize fairly the financial position and results of operations for such periods in accordance with GAAP. All adjustments are of a normal recurring nature. The results of operations for the most recent interim period are not necessarily indicative of the results to be expected for the full year. |
Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements. |
Cash and Cash Equivalents | Cash and Cash Equivalents. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments. |
Concentration of Credit Risk | Concentration of Credit Risk. We have no significant off-balance sheet concentrations of credit risk such as foreign exchange contracts, options contracts or other foreign hedging arrangements. We maintain the majority of our cash balances with one financial institution in the form of demand deposits. Accounts receivable are typically unsecured and are derived from transactions with and from entities in the healthcare industry primarily located in the United States. Accordingly, we may be exposed to credit risk generally associated with the healthcare industry. We maintain allowances for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments. The net accounts receivable balance at June 30, 2020 of $796,955 and at March 31, 2020 of $881,194 included no more than 8% from any one customer. |
Inventories | Inventories June 30, 2020 March 31, 2020 Raw materials $ 1,413,140 $ 1,147,983 Finished goods 348,217 516,918 Total gross inventories 1,761,357 1,664,901 Less reserve for obsolescence (53,000 ) (39,000 ) Total net inventories $ 1,708,357 $ 1,625,901 |
Property and Equipment | Property and Equipment |
Long-Lived Assets | Long-Lived Assets. |
Patents | Patents. |
Income Taxes | Income Taxes. |
Revenue Recognition | Revenue Recognition. |
Research and Development Expenses | Research and Development Expenses |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation expense recognized under ASC 718 for the three months ended June 30, 2020 and 2019 was $7,534 and $7,702, respectively, which consisted of stock-based compensation expense related to grants of employee stock options. |
Segment Reporting | Segment Reporting. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements. ASU No. 2014-09 (ASC 606), Revenue from Contracts with Customers became effective for us beginning April 1, 2018, and we adopted the new accounting standard using the modified retrospective transition approach. We record revenue under ASC 606 at a single point in time, when control is transferred to the customer, which is consistent with past practice. We will continue to apply our current business processes, policies, systems and controls to support recognition and disclosure under the new standard. Based on the results of the evaluation, we have determined that the adoption of the new standard presents no material impact on our financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) ("ASU 2016-02"), which modified lease accounting for both lessees and lessors to increase transparency and comparability by recognizing lease assets and lease liabilities by lessees for those leases classified as operating leases under previous accounting standards and disclosing key information about leasing arrangements. Within the opening balances for the fiscal year beginning April 1, 2019, we recognized leased assets and leased liabilities in other long-term assets of $1,555,150 and long-term liabilities of $1,619,842 (see Note 4). |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Schedule of inventory | At June 30, 2020 and March 31, 2020, inventory consisted of the following: June 30, 2020 March 31, 2020 Raw materials $ 1,413,140 $ 1,147,983 Finished goods 348,217 516,918 Total gross inventories 1,761,357 1,664,901 Less reserve for obsolescence (53,000 ) (39,000 ) Total net inventories $ 1,708,357 $ 1,625,901 |
BASIC AND DILUTED INCOME AND _2
BASIC AND DILUTED INCOME AND LOSS PER COMMON SHARE (Tables) | 3 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of calculation of basic and diluted net loss per share | The following table presents the calculation of basic and diluted net loss per share: Three Months Ended June 30, 2020 June 30, 2019 Net (loss) $ (139,305 ) $ (181,894 ) Weighted-average shares — basic 11,582,641 11,558,355 Effect of dilutive potential common shares — — Weighted-average shares — diluted 11,582,641 11,558,355 Net (loss) per share — basic $ (0.01 ) $ (0.02 ) Net (loss) per share — diluted $ (0.01 ) $ (0.02 ) Antidilutive employee stock options and RSUs 1,018,000 980,286 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of minimum future lease payments, by fiscal year | The minimum future lease payment, by fiscal year, as of June 30, 2020 is as follows: Fiscal Year Amount 2021 259,792 2022 357,667 2023 372,167 2024 386,667 2025 232,139 Total $ 1,608,432 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 3 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of stock-based compensation expense related to employee stock options | The following table summarizes stock-based compensation expense related to employee stock options for the three months ended June 30, 2020 and 2019, which was allocated as follows: Three Months Ended June 30, 2020 June 30, 2019 Cost of sales $ 718 $ 681 Sales and marketing 1,158 790 General and administrative 5,172 5,622 Research and development 486 609 Stock-based compensation expense $ 7,534 $ 7,702 |
ORGANIZATION AND NATURE OF BU_2
ORGANIZATION AND NATURE OF BUSINESS (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | ||||
Jun. 30, 2020 | May 31, 2020 | Apr. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||
Accumulated deficit | $ (22,187,764) | $ (22,187,764) | $ (22,048,459) | |||
Net loss | (139,305) | $ (181,894) | ||||
Decrease in shareholders' equity | 131,771 | |||||
Share-based compensation | $ 7,534 | |||||
Decrese in in revenue percentage | 8.00% | 33.00% | 50.00% |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | Jun. 30, 2020 | Mar. 31, 2020 |
Inventories | ||
Raw materials | $ 1,413,140 | $ 1,147,983 |
Finished goods | 348,217 | 516,918 |
Total gross inventories | 1,761,357 | 1,664,901 |
Less reserve for obsolescence | (53,000) | (39,000) |
Total net inventories | $ 1,708,357 | $ 1,625,901 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Mar. 31, 2020 | Apr. 02, 2019 | |
Property, Plant and Equipment [Line Items] | ||||
Federally insured limit | $ 250,000 | |||
Accounts Receivable | 796,955 | $ 881,194 | ||
Depreciation expense | 18,418 | $ 36,334 | ||
Stock-based compensation expense | 7,534 | $ 7,702 | ||
Unrecognized tax benefits | $ 0 | |||
Other long-term assets | $ 1,555,150 | |||
Long-term liabilities | $ 1,619,842 | |||
Minimum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Estimated useful lives of assets | 5 years | |||
Maximum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Estimated useful lives of assets | 7 years |
BASIC AND DILUTED INCOME AND _3
BASIC AND DILUTED INCOME AND LOSS PER COMMON SHARE (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Earnings Per Share [Abstract] | ||
Net loss | $ (139,305) | $ (181,894) |
Weighted-average shares - basic | 11,582,641 | 11,558,355 |
Effect of dilutive potential common shares | 0 | 0 |
Weighted-average shares - diluted | 11,582,641 | 11,558,355 |
Net loss per share-basic | $ (0.01) | $ (0.02) |
Net loss per share-diluted | $ (0.01) | $ (0.02) |
Antidilutive employee stock options and RSUs | 1,018,000 | 980,286 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) | Jun. 30, 2020USD ($) |
Minimum future lease payments, by fiscal year | |
2021 | $ 259,792 |
2022 | 357,667 |
2023 | 372,167 |
2024 | 386,667 |
2025 | 232,139 |
Total | $ 1,608,432 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | Aug. 09, 2019 | Apr. 17, 2020 |
Loan description | we entered into a loan and security agreement with Crestmark Bank. The loan is due on demand, has no financial covenants and is secured by all of our assets. Under the agreement, we were provided with a line of credit that is not to exceed the lesser of $1,000,000 or 85% of eligible accounts receivable. The interest rate is prime rate (3.25% at June 30, 2020) plus 1.5%, with a floor of 6.75%, plus a monthly maintenance fee of 0.4%, based on the average monthly loan balance. Interest is charged on a minimum loan balance of $500,000, a loan fee of 1% annually, and an exit fee of 3%, 2% and 1% during years one, two and three, respectively. | |
Lease expiration date | Oct. 31, 2024 | |
PPP | ||
Proceeds from loan | $ 598,567 | |
Interest rate | 1.00% | |
Term | 5 years |
SHARE-BASED COMPENSATION (Detai
SHARE-BASED COMPENSATION (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation expense | $ 7,534 | $ 7,702 |
Cost Of Sales [Member] | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation expense | 718 | 681 |
Selling And Marketing Expense [Member] | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation expense | 1,158 | 790 |
General And Administrative Expense [Member] | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation expense | 5,172 | 5,622 |
Research And Development Expense [Member] | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation expense | $ 486 | $ 609 |
SHARE-BASED COMPENSATION (Det_2
SHARE-BASED COMPENSATION (Details Narrative) - USD ($) | 3 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Share-based Compensation Details Narrative | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants | 20,000 | 40,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested Options Forfeited | 50,000 | |
Unrecognized compensation costs related to nonvested stock options | $ 81,000 |
RELATED PARTY TRANSACTION (Deta
RELATED PARTY TRANSACTION (Details Narrative) - USD ($) | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Director [Member] | ||
Related Party Transaction [Line Items] | ||
Consulting fees paid | $ 14,603 | $ 20,094 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - Subsequent Event [Member] - EIDL | Aug. 04, 2020USD ($) |
Proceeds from loan | $ 150,000 |
Interest rate | 3.75% |
Term | 30 years |