COMMITMENTS AND CONTINGENCIES |
9 Months Ended | ||||
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Jun. 30, 2015 | |||||
| Commitments and Contingencies Disclosure [Abstract] | |||||
| Commitments and Contingencies Disclosure [Text Block] |
Property Lease Obligations
On October 1, 2014, the Company entered into a one year lease for 4,000 square feet of office space in Indianapolis, Indiana, at a monthly rent of $2,417.
On March 1, 2015, the Company entered into a one year lease for 1,333 square feet of warehouse space in Ocala, Florida, at a monthly rent of $663.
Rental expense, resulting from property lease agreements was $55,080 and $125,631 respectively, for the three and nine months ending June 30, 2015, and $46,179 and $134,678, respectively for the three and nine months ended June 30, 2014.
Entry into a Factoring Agreement
On October 6, 2014, the Company entered into an exclusive Factoring Agreement ("the Gibraltar Agreement") with Gibraltar Business Capital, LLC (Gibraltar). The initial term of the Gibraltar Agreement is one year, and is renewable on a year to year basis. Unpaid accounts receivable purchased by Gibraltar cannot exceed $250,000 at any time. Under the terms of the Gibraltar Agreement, the Company receives on a recourse basis advances of up to 85% of the net sale amount.
Accrued Litigation Expense
Legal Matters. The Company is involved in litigation claims arising in the ordinary course of business. Legal fees and other costs associated with such actions are expensed as incurred. In addition, the Company assesses, in conjunction with its legal counsel, the need to record a liability for litigation and contingencies. The Company reserves for costs relating to these matters when a loss is probable and the amount can be reasonably estimated. As of June 30, 2015, the Company has an accrued expense in Commitments and Contingencies for the following legal matters, however, the amount of future accruals required associated with these claims, if any, cannot be determined with certainty. The balance of the amount in accrued litigation cost at June 30, 2015 includes matters that have been settled and agreed to, but which remain unpaid.
Michael Martin and Paris Arey vs. Beacon Enterprise Solutions Group, Inc. and MDT Labor, LLC
Jefferson County, Kentucky Circuit Court; Case No. 12CI-05572
Suit brought by former Beacon employees for claims for severance and change in control bonuses, breach of contract, wage claims, and other related employment matters.
Relief sought is approximately $570,000, which has been fully accrued for by the Company.
Roadsafe Traffic Systems, Inc. v. Focus Fiber Solutions, LLC, et al vs. Zayo Group
Maricopa County Case No. CV2014-090231
Claim for payment for services which Focus Fiber contends were assumed under a June 19, 2013 Asset Purchase Agreement and are the obligations of other parties and/or other individuals or entities. The liability for this claims is being pursued against other parties and/or other individuals or entities for ultimate liability.
Relief sought is approximately $139,932, which has been fully accrued for by the Company.
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