What changed in this filing

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Item 1. Financial Statements

2024-11-14 compared with 2024-05-15 · 111 added, 181 removed, 294 unchanged (50% of the section changed)

3 unchanged sentences

(in thousands except share and per share amounts)

September 30,

Current Assets:

12 unchanged sentences

Accrued expenses

Customer refunds

Customer deposits

7 unchanged sentences

Stockholders’ Equity

Common stock, $ 0.00001 par value, 100,000,000 shares authorized, 10,285,971 and 10,685,778 shares issued and outstanding at March 31, 2024 and June 30, 2023, respectively

Common stock, $ 0.00001 par value, 100,000,000 shares authorized, 9,896,850 and 9,896,850 shares issued and outstanding at September 30, 2024 and June 30, 2024, respectively

Additional paid-in capital

7 unchanged sentences

Three Months Ended

Nine Months Ended

September 30,

Cost of goods sold

4 unchanged sentences

Total operating expenses

Operating loss

Operating (loss) income

Other income (expense)

Unrealized gain on marketable securities

Realized loss on marketable securities

Interest and other income, net

Total other income

Net income/(loss)

Net (loss) income

Weighted average shares outstanding:

basic and diluted (Note 5)

Net profit/(loss) per common share basic and diluted

Net (loss) income per common share basic and diluted

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

(in thousands except for share amounts)

Three and Nine months ended March 31, 2024

Additional Paid-In

Three months ended September 30, 2024

Paid-In Capital

Balance as of June 30, 2024

1 unchanged sentence

Balance as of September 30, 2024

Grant of options to officer

Share buyback and cancellation

Balance as of December 31, 2023

Grant of options to officer

Issuance of stock to directors

Share buyback and cancellation

Share buyback and cancellation for officer

Balance as of March 31, 2024

Three and Nine months ended March 31, 2023

Additional Paid-In

Three months ended September 30, 2023

Paid-In Capital

Balance as of June 30, 2023

1 unchanged sentence

Balance as of September 30, 2023

Balance as of December 31, 2022

Share buyback and cancellation

Balance as of March 31, 2023

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

(in thousands)

Nine Months Ended

Three Months Ended

Cash flows from operating activities:

Net income/(loss)

Adjustments to reconcile net (loss) to net cash (used in) operating activities:

Net (loss) income

Adjustments to reconcile net (loss)/income to net cash (used in) operating activities:

Provision for credit losses

2 unchanged sentences

Amortization expense

ROU amortization

Right-of-use amortization

Stock option compensation expense

Realized gain on investments

Changes in operating assets and liabilities

2 unchanged sentences

Accounts payable

Accrued expenses

Accrued expenses and customer refunds

Unearned warranty revenue

3 unchanged sentences

Cash flows from investing activities

Sales of marketable securities

Purchases of marketable securities

Purchases of property and equipment

Net cash provided by (used in) investing activities

Cash flows from financing activities

Share Buyback

Stock issued for Director expense

Net cash (used in) financing activities

Net increase (decrease) in cash

Cash, beginning of the year

Cash, end of the year

Net cash (used in) investing activities

Net (decrease) increase in cash

Cash, beginning of the period

Cash, end of the period

Non-cash investing and financing activities:

Issuance of stock to employees

Right-of-use assets from ASC842 adoption

Right-of-use assets from lease modification

The accompanying notes are an integral part of these condensed consolidated financial statements.

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOT E 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization:

6 unchanged sentences

(DBA “Caddy Products”) designs, develops and manufactures innovative products for the entertainment, cinema, grocery, worship, restaurant, sports and restroom industries.

Initial Public Offering:

On July 12, 2021, the Company closed its initial public offering and issued 4,830,000 shares of its common stock at a price of $ 3.00 per share for net proceeds of approximately $ 12,360,000 after deducting underwriting discounts, commissions, and other expenses of approximately $ 2,130,000 .

On July 12, 2021, in connection with the IPO, warrants to purchase 139,611 shares of the Company’s common stock were exercised on a cashless basis.

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Impact of the COVID-19 Pandemic:

5 unchanged sentences

Throughout 2020 and through 2022 the theatres reopened as soon as local restrictions, and the status of the COVID-19 pandemic would allow.

As of March 31, 2024, a large majority of domestic and international theatres were open.

As of September 30, 2024, a large majority of domestic and international theatres were open.

The industry’s recovery to historical levels of new film content, both in terms of the number of new films and box office performance, is still underway, as the industry also continues to adjust to evolving theatrical release windows, competition from streaming and other delivery platforms, supply chain delays, inflationary pressures, labor shortages, wage rate pressures and other economic factors.

13 unchanged sentences

The June 30, 2024 condensed consolidated balance sheet has been derived from the audited consolidated financial statements.

Operating results for the three and nine months ended March 31, 2024 are not necessarily indicative of the results that may be expected for any subsequent quarters or for the year ending June 30, 2024.

Operating results for the three months ended September 30, 2024 are not necessarily indicative of the results that may be expected for any subsequent quarters or for the year ending June 30, 2025.

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Marketable Securities:

In March 2023, the Company sold all its marketable securities with the proceeds deposited to the Company’s cash account.

As a result, the prior fair value and market data disclosure are no longer needed for the period ended March 31, 2024 and June 30, 2023.

The carrying amounts of accounts receivable and accounts payable approximate fair value due to their short maturities.

Assets and Liabilities Measured on a Non-recurring Basis - In addition to assets and liabilities that are measured at fair value on a recurring basis, we also measure certain assets and liabilities at fair value on a nonrecurring basis.

1 unchanged sentence

These assets are recorded at fair value only when an impairment charge is recognized.

For the year ended June 30, 2023, the Company impaired $( 0.287 ) million in Goodwill, $( 0.363 ) million in Intangible assets and $( 0.304 ) million in Note Receivables.

There were no impairments recognized in the three and nine month periods ended March 31, 2024.

Use of Estimates:

The preparation of condensed consolidated financial statements in conformity with U.S.

GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities (including sales returns, bad debts, inventory reserves, warranty reserves, purchase price allocation and asset impairments), disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.

GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities (including sales returns, credit losses, inventory reserves, warranty reserves, purchase price allocation and asset impairments), disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.

Actual results could differ significantly from those estimates.

10 unchanged sentences

The Company does not charge interest on past-due balances or require collateral on its accounts receivable.

As of March 31, 2024 and June 30, 2023 the allowance for credit losses is approximately $ 75,000 and $ 127,000 , respectively.

As of September 30, 2024 and June 30, 2024 the allowance for credit losses is approximately $ 389,000 and $ 378,000 , respectively.

Inventories are stated at the lower of cost or net realizable value, with cost being determined on the first-in, first-out cost method of accounting.

2 unchanged sentences

The Company’s policy is to closely monitor inventory levels, obsolescence and lower market values compared to costs and, when necessary, reduce the carrying amount of its inventory to its net realizable value.

As of March 31, 2024 and June 30, 2023, the inventory reserve was $ 1,017,000 and $ 584,000 , respectively, and inventory on hand was comprised primarily of finished goods ready for sale.

As of September 30, 2024 and June 30, 2024, the inventory reserve was $ 1,186,000 and $ 1,106,000 , respectively, and inventory on hand was comprised primarily of finished goods ready for sale.

Revenue Recognition:

4 unchanged sentences

Performance obligations that are not distinct at agreement inception are combined.

The Company allocates the transaction price to each distinct performance obligation

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

proportionately based on the estimated standalone selling price for each performance obligation and then evaluates how the services are transferred to the customer to determine the timing of revenue recognition.

The Company allocates the transaction price to each distinct performance obligation proportionately based on the estimated standalone selling price for each performance obligation and then evaluates how the services are transferred to the customer to determine the timing of revenue recognition.

The Company considers the U.S.

2 unchanged sentences

If there are circumstances where the above criteria are not met, revenues recognized are presented net of cost of goods sold.

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued )

Contract assets consist of conditional or unconditional rights to consideration.

3 unchanged sentences

Such deposits are reflected as customer deposits and recognized in revenue when control of the products is transferred or when performance conditions are satisfied per the agreement.

The change in contract liabilities (customer deposits and unearned warranty revenue) during the nine months ended March 31, 2024 included $ 0.999 million for revenue recognized that was included in contract liability as of July 1, 2023.

The change in contract liabilities (customer deposits and unearned warranty revenue) during the three months ended September 30, 2024 included $ 0.731 million for revenue recognized that was included in contract liability as of June 30 2024.

Contract Liabilities ($ in Thousands)

March 31, 2024

September 30, 2024

June 30, 2024

Contract Liabilities

Customer deposits

Unearned warranty revenue

Unearned Revenue

Customer refunds

Total contract liabilities

Cost of goods sold includes cost of inventory sold during the period, net of vendor discounts and allowances, and shipping and handling costs, and sales taxes.

3 unchanged sentences

Three Months Ended

Nine Months Ended

September 30,

Disaggregation of Revenue ($ in Thousands)

March 31, 2024

March 31, 2023

March 31, 2024

March 31, 2023

Equipment upon delivery (point in time)

3 unchanged sentences

Revenue from the sale of equipment is recognized upon shipment of such equipment to customers and when performance conditions are satisfied at the custom location.

Revenue from installation is recognized upon completion of the installation project and when the performance obligation is complete.

Revenue from installation labor is recognized upon completion of the installation project and when the performance obligation is complete.

Software subscription revenue for remote monitoring services is recognized on a straight-line basis over the term of the contract, usually one year .

2 unchanged sentences

The Company records allowances for discounts and product returns at the time of sale as a reduction of revenue as such allowances can be reliably estimated based on historical experience and known trends.

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Shipping and Handling Costs:

1 unchanged sentence

Advertising Costs:

Advertising costs were approximately $ 13,600 and $ 8,600 for the three months ended March 31, 2024 and 2023, respectively, and $ 23,200 and $ 19,000 for the nine months ended March 31, 2024 and 2023, respectively.

Advertising costs were approximately $ 4,000 and $ 3,400 for the three months ended September 30, 2024 and 2023 .

Advertising costs are expensed as incurred within selling and marketing expenses.

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Intangible assets:

2 unchanged sentences

Management reviews its intangible assets for impairment whenever events or circumstances indicate that the carrying amount of an asset may not be fully recoverable.

There were no intangible asset impairments recognized for the three months and nine months ended March 31, 2024 or 2023.

There were no intangible asset impairments recognized for the three months ended September 30, 2024 or 2023.

Business Combinations:

8 unchanged sentences

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

The following table summarizes the components of deferred tax assets and deferred tax liabilities at March 31, 2024 and June 30, 2023 (in thousands):

The following table summarizes the components of deferred tax assets and deferred tax liabilities at September 30, 2024 and June 30, 2024 (in thousands):

$ in Thousands

Deferred Tax Assets (Liabilities)

March 31, 2024

September 30, 2024

June 30, 2024

3 unchanged sentences

Accumulated intangible amortization

Unrealized loss on investments

Deferred rent

6 unchanged sentences

In accordance with ASC 842, on July 1, 2024 the Company recognized Right of Use Assets in the amount of $ 998,000 and a lease liability of $ 998,000 for the leases associated with its executive office and warehouse space, as described in Note 8.

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Product Warranty:

2 unchanged sentences

The Company has the right to return defective products for up to three years , depending on the manufacturers’ individual policies.

As of March 31, 2024 and June 30, 2023, the Company has established a warranty reserve of $ 65,000 and $ 53,000 , respectively, which is included in accrued expenses in the accompanying condensed consolidated balance sheets.

As of September 30, 2024 and June 30, 2024, the Company has established a warranty reserve of $ 56,000 and $ 69,000 , respectively, which is included in accrued expenses in the accompanying condensed consolidated balance sheets.

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

The changes in the Company’s aggregate warranty liabilities were as follows for the following periods (in thousands):

Nine Months Ended March 31,

Year Ended June 30,

Product warranty liability beginning of period

September 30,

Produce warranty liability, beginning of period

Accruals for warranties issued

Change in estimates

Settlements made

Product warranty liability end of the period

Produce warranty liability, end of period

Research and Development:

2 unchanged sentences

Recently Issued Accounting Pronouncements:

In June 2016, the FASB issued ASU No.

2016-13, Financial Instruments-Credit Losses (Topic 326) (“ASU 2016-13”), which significantly changes how entities will account for credit losses for most financial assets and certain other instruments that are not measured at fair value through net income.

ASU 2016-13 replaces the existing incurred loss model with an expected credit loss model that requires entities to estimate an expected lifetime credit loss on most financial assets and certain other instruments.

Under ASU 2016-13 credit impairment is recognized as an allowance for credit losses, rather than as a direct write-down of the amortized cost basis of a financial asset.

The impairment allowance is a valuation account deducted from the amortized cost basis of financial assets to present the net amount expected to be collected on the financial asset.

The Company adopted the new pronouncement on July 1, 2023.

The allowance for credit losses has been adjusted for management’s current estimate at each reporting date.

The new guidance provides no threshold for recognition of impairment allowance.

Therefore, entities must also measure expected credit losses on assets that have a low risk of loss.

For instance, trade receivables that are either current or not yet due may not require an allowance reserve under currently generally accepted accounting principles, but under the new standard, Management has estimated an allowance for expected credit losses on trade receivables.

Due to the Management’s continuing ability to obtain 90 % of contract value in up-front customer deposits, the Company’s risk is only the remaining 10 % of the customer’s contract value.

The combined effect of up-front customer deposits, prompt collection of trade receivables and application of historical aging criteria has resulted in minimal bad debts and allowances for credit losses.

NOTE 2 — INVESTMENTS

In March 2023, the Company sold all its marketable securities with the proceeds deposited to the Company’s cash account.

In November 2023, FASB issued ASU 2023-07 on segment disclosures.

The amendments will be effective for fiscal years beginning after December 15, 2023 (fiscal 2025 for the Company) and interim periods within fiscal years beginning after December 15, 2024 (fiscal 2026 for the Company).

NOTE 2 — LOSS PER SHARE

3 unchanged sentences

A reconciliation of basic and diluted loss per share is as follows:

Dollars in Thousands

For the Three Months Ended

For the Nine Months Ended

Loss per Share

For the Three Months Ended

For the Nine Months Ended

Net income/(loss)

(In Thousands except for share

September 30,

and per share price)

Net (loss)/Income

Weighted average common shares outstanding, basic and diluted

Profit/(loss) per share

Net (loss)/income per share

Basic and diluted

1 unchanged sentence

For the Three Months Ended

For the Nine Months Ended

For the Three Months Ended

For the Nine Months Ended

Total potentially dilutive shares

For the three and nine months ended March 31, 2024 the Company had a net loss.

For the three months ended September 30, 2024 the Company had a net loss.

However, all potentially dilutive securities were also deemed to be anti-dilutive because their exercise price exceeded the weighted average trading price of the Company’s stock for the period.

1 unchanged sentence

Property and equipment consist of the following (in thousands):

Property and Equipment

For the Three Months

($ in Thousands)

Ended September 30

Ended June 30

Production equipment

5 unchanged sentences

Net property and equipment

Depreciation expense related to property and equipment was $ 3,500 and $ 2,000 for the three months ended March 31, 2024 and 2023, respectively of which $ 0 and $ 0 is included in cost of goods and $ 3,500 and $ 2,000 in general and administrative expense, respectively.

Depreciation expense related to property and equipment was $ 9,000 and $ 6,000 for the nine months ended March 31, 2024 and 2023, respectively of which $ 9,000 and $ 3,000 in general and administrative expense, respectively.

Depreciation expense related to property and equipment was $ 4,000 and $ 2,500 for the three months ended September 30, 2024 and 2023, respectively of which $ 0 and $ 2,100 is included in cost of goods and $ 3,000 and $ 400 in general and administrative expense, respectively.

NOTE 3 — PROPERTY AND EQUIPMENT (continued)

Depreciation of property and equipment is calculated using the straight-line method over their estimated useful lives as follows:

6 unchanged sentences

NOTE 4— INTANGIBLE ASSETS

The following table summarizes the Company’s intangible assets as of March 31, 2024 (in thousands):

The following table summarizes the Company’s intangible assets as of September 30, 2024 (in thousands):

Customer relations

NOTE 5 — INTANGIBLE ASSETS (continued)

The following table summarizes the Company’s intangible assets as of June 30, 2024 (in thousands):

Customer relations

Amortization expense was $ 15,000 and $ 24,000 for the three months ended March 31, 2024 and 2023, respectively, and was $ 43,000 and $ 72,000 for the nine months ended March 31, 2024 and 2023, respectively, and is included in general and administrative expense.

Estimated amortization expense related to intangible assets subject to amortization at March 31, 2024 in each of the years subsequent to March 31, 2024, and thereafter is as follows (amounts in thousands):

NOTE 4— INTANGIBLE ASSETS (continued)

Amortization expense was $ 15,000 and $ 14,000 for the three months ended September 30, 2024 and 2023, respectively, and is included in general and administrative expense.

Estimated amortization expense related to intangible assets subject to amortization at September 30, 2024 in each of the years subsequent to September 30, 2024, and thereafter is as follows (amounts in thousands);

NOTE 5 — ACCRUED EXPENSES

Accrued expenses consist of the following (in thousands):

Accrued Expenses

September 30,

($ in Thousands)

Employee compensation

Accrued warranty

Customer refund

NOTE 6 — STOCKHOLDERS’ EQUITY

1 unchanged sentence

The Plan, as amended, provides for the issuance of stock-based awards to employees.

As of March 31, 2024, the Plan provides for the issuance of up to 1,500,000 stock-based awards.

There are 1,220,000 stock-based awards available to grant under the Plan at March 31, 2024.

As of September 30, 2024, the Plan provides for the issuance of up to 1,500,000 stock-based awards.

There are 1,220,000 stock-based awards available to grant under the Plan at September 30, 2024.

In July 2021, MiT Inc.

1 unchanged sentence

agreed to exchange membership units for 2,350,000 shares of Common Stock representing 41.4 % of the equity as of such date on a fully diluted basis for no consideration.

The shares were exchanged as part of the Exchange Agreement with the Company as described in Note 1.

In July 2021, the Company granted options to non-employee directors to purchase an aggregate of 150,000 shares of its common stock at an exercise price of $ 3.00 per share.

The options vest one year from the date of grant, expire ten years from the date of grant and had an aggregate grant date fair value of $ 244,200 , which was recognized ratably over the vesting period.

On May 26, 2023, the Board of Directors cancelled 150,000 options consisting of 50,000 options each to John Stiska, Katherine Crothall and Scott Anderson with an exercise price of $ 3.00 .

In its place, the Board granted 150,000 options consisting of 50,000 options each with an exercise price of $ 1.10 vesting immediately to John Stiska, Katherine Crothall and Scott Anderson .

In addition to the director options, the Board granted CFO William Greene 100,000 options with an exercise price of $ 1.10 with 25 % vesting immediately the remainder vesting at 25 % per year thereafter.

These options, which were the only options granted during the year ended June 30, 2023, had a grant-date fair value of $ 1.10 per share.

The Company recognized compensation expense for stock option awards of approximately $ 113,000 during the year ended June 30, 2023.

None of these potentially dilutive securities were included in the computation of diluted earnings per share as their impact would be anti-dilutive.

The Company recognized $ 5,000 and $ 15,000 in compensation expense for stock options during the three months and nine months ended March 31, 2024, respectively.

The shares were exchanged as part of the Exchange Agreement with the Company.

The Company recognized $ 5,000 and $ 5,000 in compensation expense for stock options during the three months ended September 30, 2024 and September 30, 2023, respectively.

On March 6, 2023, the Board of Directors (the “Board”) of Moving iMage Technologies, Inc.

(the “Company”) approved an amendment (the “Amendment”) to the Company’s Amended and Restated Bylaws that amends the quorum for a stockholders’ meeting or action to be at least 33 1/3% of all shares of stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy.

At March 31, 2024, there was no unrecognized compensation cost related to nonvested stock option awards and no option grants during the period.

For the three month period ended September 30, 2024, there was no unrecognized compensation cost related to nonvested stock option awards and no option granted.

NOTE 6 — STOCKHOLDERS’ EQUITY (continued)

The estimated fair value of each option award granted was determined on the date of grant using the Black-Scholes option valuation model.

No options were granted during the three and nine months ended March 31, 2024.

The following weighted average assumptions were used for option grants during the nine months ended March 31, 2023:

No options were granted during the three and nine months ended September 30, 2024.

The following weighted average assumptions were used for option grants during the three months ended September 30, 2023:

Risk-free interest rate

2 unchanged sentences

Expected option term in years

On March 23, 2023 the Board of Directors re-authorized a stock repurchase program.

Under the stock repurchase program, the Company may repurchase up to $ 1 million of its outstanding common stock over the next 12 months.

The program expired on March 23, 2024 and a new program was established on April 1, 2024 – see Note 10 Subsequent Events for more information.

During the nine months ended March 31, 2024, the Company repurchased 418,745 of the Company’s stock at an average price of $ 0.78 per share.

NOTE 7 — STOCKHOLDERS’ EQUITY (continued)

On February 28, 2024, the Company and Joe Delgado, Executive Vice President of Sales (“Joe Delgado”) agreed to sell 49,586 shares of common stock at a price of $ 0.667 per share (based on the closing stock price as of February 27, 2024) for a total of $ 33,000 , which amount represents satisfaction of Mr.

Delgado’s $ 25,000 outstanding obligation to the Company plus an estimated $ 8,000 in federal and California state income taxes incurred in connection with the sale.

Following the purchase, the shares were cancelled by the Company.

As authorized by the Board on May 26, 2023, directors may receive their board fees as cash on in shares of the Company’s stock.

The Company records director fee expense at the end of each board meeting.

On March 25, 2024, the Company subsequently issued 18,938 shares to its independent directors for director fees earned during the nine months ended March 31, 2024.

$ in Thousands, except shares and dollar per share amounts

Total Number of

Dollar Value of

Shares that May

Total Number of

Part of Publicly

Yet Be Purchased

Average Price

Announced Plans

Under the Plans

Paid per Share

March 23, 2023 – March 31, 2023

May 18, 2023 - June 30, 2023

Nov 1, 2023 - Dec 31, 2023

Jan 1, 2024 - Mar 31, 2024

On July 12, 2022, the Company granted 130,000 shares of common stock, with a fair market value of approximately $ 153,000 , to employees as compensation for previously provided service, which was accrued as of June 30, 2022.

A summary of the status of the Company’s stock options as of March 31, 2024 and changes during the nine months ended March 31, 2024 are presented below.

On March 25, 2024, the Company subsequently issued 18,938 shares to its independent directors for director fees earned during the nine months ended September 30, 2024.

A summary of the status of the Company’s stock options as of September 30, 2024 and changes during the three months ended September 30, 2024 are presented below.

Balance, July 1, 2024

2 unchanged sentences

Cancelled during the period

Balance, March 31, 2024

NOTE 7 — STOCKHOLDERS’ EQUITY (continued)

A summary of the status of the Company’s stock options as of March 31, 2023 and changes during the nine months ended March 31, 2023 are presented below.

Balance, September 30, 2024

A summary of the status of the Company’s stock options as of September 30, 2023 and changes during the three months ended September 30, 2023 are presented below.

Balance, July 1, 2022

2 unchanged sentences

Terminated/Expired during the period

Balance, March 31, 2023

The following table summarizes information about outstanding and exercisable stock options at March 31, 2024:

Balance, September 30, 2023

The following table summarizes information about outstanding and exercisable stock options at September 30, 2024:

Exercise Price

There was no warrant activity or warrants outstanding during the year ended June 30, 2023 or for the three and nine months ended March 31, 2024 and 2023.

There was no warrant activity or warrants outstanding during the year ended June 30, 2024 or for the three months ended September 30, 2024 and 2023.

NOTE 7 — CUSTOMER AND VENDOR CONCENTRATIONS

one customer accounted for 10 % of the Company’s sales for the three months ended March 31, 2024.

One customer accounted for 12 % of the Company’s sales for the nine months ended March 31, 2024.

At March 31, 2024, the amount of outstanding receivables related to the one customer was approximately $ 176,000 .

One customer accounted for approximately 12 % of the Company’s sales for the three months ended March 31, 2023.

One customer accounted for approximately 12 % of the Company’s sales for the nine months ended March 31, 2023.

Approximately 16 % and 10 % of the Company’s purchases were provided by two vendors for the three months ended March 31, 2024.

Approximately 16 % and 15 % of the Company's purchases were provided by two vendors for the nine months ended March 31, 2024.

Approximately 12 % and 11 % of the Company's purchases were provided by two vendors for the three months ended March 31, 2023.

Approximately 22 % and 13 % of the Company's purchases were provided by two vendors for the nine months ended March 31, 2023.

Three customers accounted for 17 % , 13 % and 11 % , respectively, of the Company’s sales for the three months ended September 30, 2024.

At September 30, 2024, the amount of outstanding receivables related to the three customers was approximately $ 135,000 .

Two customers accounted for 15 % and 14 % of the Company’s sales for the three months ended September 30, 2023.

Approximately 26 % of the Company’s purchases were provided by one vendor for the three months ended September 30, 2024.

Approximately 23 % and 20 % of the Company's purchases were provided by two vendors for the three months ended September 30, 2023.

NOTE 8 — LEASE COMMITMENTS AND CONTINGENCIES

6 unchanged sentences

The agreements provide for initial monthly base amounts plus annual escalations through the term of the leases.

On July 23, 2024, the Company renewed its Fountain Valley location effective February 1, 2025 by an additional five years with a January 31, 2030 lease expiration date.

Both parties agreed that July 23, 2024 was the effective modification date.

The monthly rent payable for the first year of the extended term will be $ 19,362 and increases by 4 % on each anniversary date.

On June 4, 2024, the Company notified its Grace facility location landlord of its intent to vacate at the end of the current January 31, 2025 lease term.

In addition to the monthly base amounts in the lease agreements, the Company is required to pay a portion of real estate taxes and common operating expenses during the lease terms.

The Company’s operating lease expense was $ 86,000 and $ 73,000 for the three months ended September 30, 2024 and 2023, respectively.

NOTE 8 — LEASE COMMITMENTS AND CONTINGENCIES (continued)

The Company’s operating lease expense was $ 72,000 and $ 73,000 for the three months ended March 31, 2024 and 2023, respectively.

The Company’s operating lease expense was $ 218,000 and $ 214,000 for the nine months ended March 31, 2024 and 2023, respectively.

Future minimum lease payments at March 31, 2024 under these arrangements are as follows:

Future minimum lease payments at September 30, 2024 under these arrangements are as follows:

(in thousands)

3 unchanged sentences

Present value of operating lease payments

The following table sets forth the ROU assets and operating lease liabilities as of March 31, 2024:

The following table sets forth the ROU assets and operating lease liabilities as of September 30, 2024:

(in thousands)

3 unchanged sentences

Total ROU liabilities

The Company’s weighted average remaining lease term for its operating leases is 0.8 years.

The Company’s weighted average remaining lease term for its operating leases is 5.2 years using a weighted average discount rate of 8.5 %.

Legal Matters:

2 unchanged sentences

NOTE 9 — SUBSEQUENT EVENTS

On April 1, 2024, the Board of Directors authorized a new share repurchase program for the repurchase of up to $ 363,000 worth of shares and will expire at the earlier of June 30, 2024, or when the maximum dollar amount of shares is repurchased.

All repurchases will be implemented in accordance with the applicable requirements of Rule 10b-18 under the U.S.

Securities Exchange Act of 1934.

On May 8, 2024, the Board of Directors authorized a $ 25,000 payment to CEO Phil Rafnson as part of a pay increase to $ 250,000 per year from the CEO’s current pay of $ 200,000 , effective as of November 1, 2023.

Management has evaluated events from March 31, 2024 through May 15, 2024, the date these financial statements were available to be issued and determined that there have been no other events that occurred that would require adjustment to our disclosures in the condensed consolidated financial statements.

On October 30, 2024, the Board of Directors of Moving iMage Technologies, Inc.

the Company appointed Francois Godfrey to serve as the Company’s President, Chief Operating Officer and Board Member, effective October 30, 2024.

Godfrey replaces Phil Rafnson as President with Mr.

Rafnson remaining as the Company’s Chief Executive Office and Chairman of the Board.

On October 30, 2024, Bevan Wright, Executive Vice President, resigned from the Board of Directors and will serve as an advisory board member, effective October 30, 2024, 2024.

Wright’s decision to resign from the Board was not due to any disagreement with the Company on any matter relating to the Company’s operations, policies or practices.

In connection with Mr.

Godfrey’s appointment, on October 30, 2024, the Company and Mr.

Godfrey entered into an arrangement pursuant to which Mr.

Godfrey will be paid an annual salary of $ 225,000 .

On October 30, 2024, the Company entered into a new 4,344 square foot facility lease with a three-year lease term and a February 1, 2028.lease expiration date.

The monthly rent payable for the first year of the extended term will be $ 6,299 and increases by 4 % on each anniversary date.

NOTE 9 — SUBSEQUENT EVENTS (continued)

Management has evaluated events from September 30, 2024 through November 14, 2024, the date these financial statements were available to be issued and determined that there have been no other events that occurred that would require adjustment to our disclosures in the condensed consolidated financial statements.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements