What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-05-16 compared with 2022-02-14 · 121 added, 103 removed, 343 unchanged (40% of the section changed)

5 unchanged sentences

Cash and cash equivalents

Accounts receivable, net of allowance for doubtful accounts of $ 252,883 at December 31, 2021 and $ 251,383 at June 30, 2021

Due from related party

Accounts receivable, net of allowance for doubtful accounts of $ 253,633 at March 31, 2022 and $ 251,383 at June 30, 2021

Prepaid expenses

25 unchanged sentences

50,000,000 shares authorized;

issued and outstanding 16,746,696 shares at December 31, 2021 and 13,282,476 at June 30, 2021

issued and outstanding 16,887,840 shares at March 31, 2022 and 13,282,476 at June 30, 2021

Additional paid-in capital

8 unchanged sentences

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE AND SIX MONTHS ENDED

DECEMBER 31, 2021 AND 2020

Ended December 31,

FOR THE THREE AND NINE MONTHS ENDED

March 31, 2022 AND 2021

Ended March 31,

Cost of goods sold

1 unchanged sentence

Selling, general and administrative expenses

Business acquisition expenses

acquisition expenses

Total operating expenses

1 unchanged sentence

( 1,093,423 )

Interest (expense) income, net

$ ( 507,013 )

$ ( 213,454 )

Other income (expense)

Interest expense

Gain on forgiveness of bank

Net income (loss)

$ ( 113,899 )

$ ( 1,197,713 )

Loss Per Share:

Basic and fully diluted

Income (loss) per share:

Fully diluted

Weighted average common shares outstanding:

Basic and fully diluted

Fully diluted

The accompanying notes are an integral part

3 unchanged sentences

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’

FOR THE SIX MONTHS ENDED

FOR THE NINE MONTHS ENDED

31 , 2022 AND 2021

Six Month Period Ended December 31, 2021

Nine Month Period Ended March 31, 2022

Stockholders’

2 unchanged sentences

Stock-based compensation

Proceeds from private placement of common stock subscribed, net of estimated issuance costs of $ 10,000

Proceeds from private placement of common stock subscribed, net of estimated

issuance costs of $ 10,000

Balance, September 30, 2021

9 unchanged sentences

( 48,249,792 )

Six Month Period Ended December 31, 2020

Correction of error in valuation of stock issued in business acquisition

Stock-based compensation

Proceeds from exercise of stock options

Exercise of stock options net of 96,056 shares withheld

Balance, March 31, 2022

$ ( 48,363,691 )

Nine Month Period Ended March 31, 2021

Stockholders’

7 unchanged sentences

( 47,275,804 )

Stock-based compensation

Proceeds from exercise of stock options

Balance, March 31, 2021

$ ( 46,723,526 )

The accompanying notes are an integral part

3 unchanged sentences

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED

FOR THE NINE MONTHS ENDED

31 , 2022 AND 2021

Six Months Ended

Nine Months Ended

CASH FLOWS FROM OPERATING ACTIVITIES:

$ ( 1,083,814 )

Net income (loss)

$ ( 1,197,713 )

2 unchanged sentences

Stock-based compensation expense

Gain on forgiveness of bank note

Changes in Operating Assets and Liabilities, net of effects of business acquisition -

Non-cash interest expense

Accounts receivable, net

Inventories, net

Due from related party

Prepaid expenses

6 unchanged sentences

Purchases of property and equipment

Acquisition of business

Acquisition of businesses

Net Cash Used In Investing Activities

6 unchanged sentences

Net Cash Provided By (Used in) Financing Activities

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

NET DECREASE IN CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD

2 unchanged sentences

Offering costs included in accrued compensation and other

Issuance of common stock for services

Acquisition of business financed with long-term debt

Acquisition of Manufacturing Equipment Under Capital Lease

The accompanying notes are an integral part

11 unchanged sentences

prepared by the Company, without audit, and reflect normal recurring adjustments which, in the opinion of management, are necessary for

a fair statement of the results of the second quarter and six months of the Company’s fiscal year 2022.

a fair statement of the results of the third quarter and nine months of the Company’s fiscal year 2022.

These consolidated financial

10 unchanged sentences

Actual results may differ from these estimates.

Revision of the Second Quarter 2022 Unaudited

Consolidated Financial Statements

The Company identified an error in the valuation

of 2,500,000 shares of common stock issued on October 4, 2021 in the business acquisition described in Note 2 resulting in an $825,000

overstatement of Additional Paid-In Capital and Goodwill in the December 31, 2021 balance sheet presented in the quarterly report on Form

10-Q for the quarter ended December 31, 2021.

This change does not impact the number of shares issued as part of the transaction;

changes the imputed value of the common stock issued.

The financial statements for the prior interim fiscal quarter ended December 31,

2021 have been revised by an $825,000 adjustment to the opening balance of Additional Paid-In Capital in the accompanying Statement of

Stockholders Equity for the quarter ended March 31, 2022, and by an adjustment of Goodwill at the acquisition date as described in Note

No profit and loss accounts in the current or prior interim periods are affected by this revision.

Income (Loss) Per Share

4 unchanged sentences

plus the number of potentially dilutive securities outstanding during the period such as stock options.

For the three and six months ended

December 31, 2021, the effect of such securities was antidilutive and not included in the fully diluted calculation because of the net

loss generated in that period.

For the three and nine months

ended March 31, 2022, the effect of such securities was antidilutive and not included in the fully diluted calculation because of the

net loss generated during those periods.

The following is the calculation of income (loss) per share for the

three and six months ended December 31, 2021 and 2020:

three and nine months ended March 31, 2022 and 2021:

Schedule of earnings per share

Ended December 31,

Net Loss - Basic and Fully Diluted

$ ( 507,013 )

$ ( 213,454 )

Ended March 31,

Net Income (Loss) - Basic and Diluted

$ ( 113,899 )

$ ( 1,197,713 )

Basic and Dilutive Weighted Average Shares Outstanding

Loss Per Share - Basic and Fully Diluted

Weighted Average Shares Outstanding

Fully Diluted

Income (Loss) Per Share

Fully Diluted

The number of shares issuable upon the exercise

of outstanding stock options that were excluded from the computation as their effect was antidilutive was approximately 2,669,700 and

2,135,200 for the three and six months ended December 31, 2021 and 2020, respectively.

of outstanding stock options that were excluded from the computation as their effect was antidilutive was 2,817,500 for the three and

nine months ended March 31, 2022, and 15,000 and 260,000 for the three and nine months ended March 31, 2021, respectively.

Income taxes are accounted for under the asset

19 unchanged sentences

Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell.

No such impairments of goodwill or patents have been estimated by management as of December 31, 2021.

No such impairments of goodwill or patents have been estimated by management as of March 31, 2022.

BUSINESS ACQUISITION

6 unchanged sentences

The effective

date of the acquisition was October 4, 2021, and the actual results of operations and financial position of the Lighthouse division are

included in the accompanying consolidated financial statements as of, and for the three months ended, December 31, 2021.

A post acquisition

adjustment totaling $ 84,210 is owed by the seller and recorded as Due From Related Party in the accompanying balance sheet at December

date of the acquisition was October 4, 2021, and the actual results of operations of the Lighthouse division since that date are included

in the accompanying consolidated financial statements as of, and for the three and nine months ended, March 31, 2022.

The Company financed the cash portion of the acquisition

4 unchanged sentences

Purchase Price Allocation and Goodwill

The allocation of purchase price is preliminary

and subject to change based on future payments made for the earn-out contingent liability.

Any unearned portions of the earn-out liability

will be recognized in earnings.

The acquired assets, contingent consideration and assumed liabilities at the effective date of acquisition

include the following:

The total purchase price of $ 8,990,670

as previously disclosed in the quarterly report on Form 10-Q for the quarter ended December 31, 2021 has been restated for a revision

of the valuation of the common stock issued to the sellers as described in Note 1.

Revision of the Second Quarter 2022 Unaudited Consolidated

Financial Statements.

The allocation of the revised purchase price is preliminary and subject to change based on future payments

made for the earn-out contingent liability.

Any unearned portions of the earn-out liability will be recognized in earnings.

assets including the revised Goodwill, contingent consideration and assumed liabilities at the effective date of acquisition include

the following:

Schedule of acquired assets, contingent consideration and assumed liabilities

12 unchanged sentences

for the Company are presented below assuming that the acquisition of the Lighthouse division had occurred on July 1, 2020.

operating results include net adjustments resulting from the acquisition transaction during the three and six months ended December 31,

2021 and 2020.

Pro forma operating

results include net adjustments resulting from the acquisition transaction during the three and nine months ended March 31, 2022 and 2021.

Schedule of consolidated pro forma results

Ended December 31,

Ended March 31,

Net income (loss)

( 1,140,418 )

Net loss per share - basic and fully diluted

Net income (loss) per share

Fully diluted

Pro forma financial information is not necessarily

15 unchanged sentences

Line of Credit Loan Facility.

The $250,000 line of credit is due on demand and had zero borrowings outstanding at December 31, 2021.

The $250,000 line of credit is due on demand and had zero borrowings outstanding at March 31, 2022.

under the line of credit bear interest payable monthly at the prime lending rate plus 1.5% per annum and shall not be less than 4.75%

2 unchanged sentences

Long-Term Debt

Long-term debt consists of the following at December

Long-term debt consists of the following at March

Schedule of long-term debt

5 unchanged sentences

Long-term debt, net of current portion of debt issuance costs

At December 31, 2021 principal payments

At March 31, 2022 principal payments

due on the Term Loan Note payable are as follows:

5 unchanged sentences

In January 2020, the Company entered into a five-year capital lease

for $ 47,750 for manufacturing equipment.

The net book value of fixed assets under capital lease obligations as of December 31, 2021 is

in the amount of $ 47,750 for manufacturing equipment.

The net book value of fixed assets under capital lease obligations as of March 31,

2022 is $ 156,640 .

On July 1, 2019, the Company entered into a three-year

operating lease for its facility in El Paso, Texas with total remaining minimum lease payments of $ 31,411 at December 31, 2021.

rent expense including base rent and common area expenses was $ 15,705 and $ 15,190 during the three months ended December 31, 2021 and

2020, respectively.

Included in the accompanying balance sheet at December 31, 2021 is a right-of-use asset of $ 31,054 and current and

long-term right-of-use operating lease liabilities of $ 31,054 and $ 0 , respectively.

At December 31, 2021 future minimum lease payments

operating lease for its facility in El Paso, Texas, and in February 2022 the Company entered into an extension of the lease for an additional

three years through June 2025.

Remaining minimum lease payments at March 31, 2022 total $ 150,504 .

Total rent expense including base rent

and common area expenses was $ 15,705 and $ 21,438 during the three months ended March 31, 2022 and 2021, respectively.

Included in the

accompanying balance sheet at March 31, 2022 is a right-of-use asset of $ 140,607 and current and long-term right-of-use operating lease

liabilities of $ 45,405 and $ 95,202 , respectively.

At March 31, 2022 future minimum lease payments

under the capital lease and operating lease obligations are as follows:

11 unchanged sentences

Rent expense on these operating leases was $ 222,112 and $ 124,848

for the six months ended December 31, 2021 and 2020, respectively.

for the nine months ended March 31, 2022 and 2021, respectively.

STOCK-BASED COMPENSATION

1 unchanged sentence

The following table summarizes stock-based compensation

expense for the three and six months ended December 31, 2021 and 2020:

expense for the three and nine months ended March 31, 2022 and 2021:

Schedule of stock-based compensation expense

Ended December 31,

Ended March 31,

Cost of Goods Sold

5 unchanged sentences

The following tables summarize stock option activity

for the six months ended December 31, 2021:

for the nine months ended March 31, 2022:

Schedule of stock option activity

4 unchanged sentences

Contractual Life

Outstanding at June 30, 2021

Outstanding at December 31, 2021

Outstanding at July 1, 2021

Outstanding at March 31, 2022

Information related to the stock options outstanding

as of December 31, 2021 is as follows:

Schedule of stock options outstanding by exercise

as of March 31, 2022 is as follows:

Schedule of stock options outstanding by exercise price range

Exercise Prices

3 unchanged sentences

The aggregate intrinsic value of the Company’s

in-the-money outstanding and exercisable options as of December 31, 2021 was $ 2,564,065 and $ 2,119,321 , respectively.

Restricted Common Stock Granted

Effective November 17, 2021 the Company granted

an employee hired as part of the Lighthouse Imaging, LLC business acquisition 50,000 shares of restricted common stock vesting one-third

on the first three one-year anniversary dates of his date of hire, or October 1, 2022, 2023 and 2024, at which time the vesting portions

of the shares shall be issued to the employee.

A total of $ 113,000 of compensation expense was assigned as of the grant date, which will

be recognized as stock based compensation expense over the vesting period.

Stock based compensation expense for the three months ended

December 31, 2021 includes $ 9,417 relating to these restricted common stock shares.

Common Stock Issued for Services

In December 2021, the Company issued 9,045 shares

of its common stock to its Chief Financial Officer as compensation for services performed.

The company recognized $ 20,000 of stock based

compensation expense during the three months ended December 31, 2021 relating to these common stock shares.

in-the-money outstanding and exercisable options as of March 31, 2022 was $ 1,913,350 and $ 1,689,898 , respectively.

SALE OF STOCK IN OCTOBER 2021

2 unchanged sentences

price of $1.60 per share.

The Company received $ 1,500,000 in gross proceeds from the offering, $ 1,030,000 of which was received as of

September 30, 2021, and included in cash and common stock subscriptions in the September 30, 2021 balance sheet and statement of stockholders’

equity, respectively.

The Company used the net proceeds from this placement to partially fund the October 4, 2021, acquisition of the

operating assets of Lighthouse Imaging, LLC with an effective date of October 4, 2021.

The Company used the net proceeds from this placement to partially fund the October 4, 2021, acquisition of

the operating assets of Lighthouse Imaging, LLC with an effective date of October 4, 2021.

In conjunction with the placement, the Company also entered into a registration rights agreement with the investors, whereby it is obligated

2 unchanged sentences

The registration statement was filed on

January 31, 2022.

January 31, 2022 and became effective on February 11, 2022.

ISSUANCE OF COMMON STOCK IN BUSINESS ACQUISITION

1 unchanged sentence

unregistered shares of its common stock to the sellers of Lighthouse Imaging, LLC, valued on that date at $ 1.60 per share or $ 4,000,000 ,

as shown in the accompanying statement of stockholders’ equity at December 31, 2021.

as shown in the accompanying statement of stockholders’ equity for the nine months ended March 31, 2022.

In conjunction with the issuance, the Company

20 unchanged sentences

by economic factors.

Revenues are comprised of the following for the three and six months ended December 2021 and 2020:

Schedule of disaggregation of

Ended December 31,

Revenues are comprised of the following for the three and nine months ended March 2022 and 2021:

Schedule of disaggregation of revenues

Ended March 31,

Engineering Design Services

10 unchanged sentences

These costs have been recorded in selling, general and administrative expenses.

As of December 31,

As of March 31,

2022, there were no contract assets recorded in the Company’s Consolidated Balance Sheets.

6 unchanged sentences

Schedule of contract liabilities

Ended December 31,

Ended March 31,

Contract Liabilities, Beginning of Period

2 unchanged sentences

Revenue Recognized

( 1,647,188 )

Contract Liabilities, End of Period

9 unchanged sentences

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