UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended: September 30, 2024

 

or

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ___________ to ___________

 

Commission File Number: 001-39553

 

 

AMESITE INC.

(Exact name of registrant as specified in its charter)

 

Delaware   82-3431718
(State or other jurisdiction of
incorporation or organization)		   (I.R.S. Employer
Identification No.)
     
607 Shelby Street
Suite 700 PMB 214
Detroit, MI		   48226
(Address of principal executive offices)   (Zip Code)

 

(734) 876-8130

(Registrant’s telephone number, including area code)

 

N/A

(Former name, former address and former fiscal year, if changed since last report)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered
Common Stock, par value $0.0001   AMST   The Nasdaq Stock Market LLC

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒  No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒  No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer ☐ Accelerated filer ☐
Non-accelerated filer ☒ Smaller reporting company ☒ 
    Emerging growth company ☒

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐  No ☒

 

There were 2,792,440 shares of the registrant’s common stock issued and outstanding as of November 14, 2024.

 

 

 

 

 

TABLE OF CONTENTS

 

    Page
     
PART I – FINANCIAL INFORMATION   1
     
ITEM 1. FINANCIAL STATEMENTS   1
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS   13
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK   17
ITEM 4. CONTROLS AND PROCEDURES   17
     
PART II – OTHER INFORMATION   18
     
ITEM 1. LEGAL PROCEEDINGS   18
ITEM 1A. RISK FACTORS   18
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS   18
ITEM 3. DEFAULTS UPON SENIOR SECURITIES   18
ITEM 4. MINE SAFETY DISCLOSURES   18
ITEM 5. OTHER INFORMATION   18
ITEM 6. EXHIBITS   19
     
SIGNATURES   20

 

-i-

 

 

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

 

This Quarterly Report on Form 10-Q contains “forward-looking statements,” which include information relating to future events, future financial performance, financial projections, strategies, expectations, competitive environment and regulation. Words such as “may,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” and similar expressions, as well as statements in future tense, identify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results and may not be accurate indications of when such performance or results will be achieved. Forward-looking statements are based on information we have when those statements are made or management’s good faith belief as of that time with respect to future events, and are subject to a number of risks, and uncertainties and assumptions that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. These risks are more fully described in the “Risk Factors” section of this Annual Report on Form 10-K. The following is a summary of such risks:

 

  ● our planned online machine learning platform’s ability to enable universities and other clients to offer timely, improved popular courses and certification programs, without becoming software tech companies;
     
  ● our planned online machine learning platform’s ability to result in opportunistic incremental revenue for colleges, universities and other clients, and improved ability to garner state funds due to increased retention and graduation rates through use of machine learning and natural language processing;
     
  ● our ability to continue as a going concern;
     
  ● our ability to obtain additional funds for our operations;
     
  ● our ability to obtain and maintain intellectual property protection for our technologies and our ability to operate our business without infringing the intellectual property rights of others;
     
  ● our reliance on third parties to conduct our business and studies;
     
  ● our reliance on third party designers, suppliers, and partners to provide and maintain our learning platform;
     
  ● our ability to attract and retain qualified key management and technical personnel;
     
  ● our expectations regarding the time during which we will be an emerging growth company under the Jumpstart Our Business Startups Act, or JOBS Act;
     
  ● our financial performance;
     
  ● the impact of government regulation and developments relating to our competitors or our industry; and
     
  ● other risks and uncertainties, including those listed under the caption “Risk Factors.”

 

These statements relate to future events or our future operational or financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. Factors that may cause actual results to differ materially from current expectations include, among other things, those listed under the section titled “Item 1A. Risk Factors” and elsewhere in our Annual Report on Form 10-K for the year ended June 30, 2024, filed with the Securities and Exchange Commission (“SEC”) on September 30, 2024.

 

Any forward-looking statements in this Quarterly Report on Form 10-Q reflect our current view with respect to future events and are subject to these and other risks, uncertainties and assumptions relating to our business, results of operations, industry and future growth. Given these uncertainties, you should not place undue reliance on these forward-looking statements. No forward-looking statement is a guarantee of future performance. You should read this Quarterly Report on Form 10-Q, and the documents that we reference herein and have filed as exhibits hereto completely and with the understanding that our actual future results may be materially different from any future results expressed or implied by these forward-looking statements. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future.

 

This Quarterly Report on Form 10-Q also contains, or may contain, estimates, projections and other information concerning our industry, our business and the markets for our products, including data regarding the estimated size of those markets and their projected growth rates. Information that is based on estimates, forecasts, projections or similar methodologies is inherently subject to uncertainties and actual events or circumstances may differ materially from events and circumstances reflected in this information. Unless otherwise expressly stated, we obtained these industry, business, market and other data from reports, research surveys, studies and similar data prepared by third parties, industry and general publications, government data and similar sources. In some cases, we do not expressly refer to the sources from which these data are derived.

 

-ii-

 

 

PART I – FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

Amesite Inc.

 

Condensed Financial Statements

September 30, 2024

 

-1-

 

 

Amesite Inc.

Contents

 

Condensed Financial Statements   Page
Condensed Balance Sheets (unaudited)   3
     
Condensed Statements of Operations (unaudited)   4
     
Condensed Statements of Stockholders’ Equity (unaudited)   5
     
Condensed Statements of Cash Flows (unaudited)   6
     
Notes to Condensed Financial Statements   7

 

-2-

 

 

Amesite Inc.

Condensed Balance Sheets (unaudited)

 

   September 30,
2024		   June 30,
2024		 
Assets        
Current Assets        
Cash and cash equivalents  $1,434,753   $2,071,016 
Restricted cash   100,000    100,000 
Accounts receivable   
-
    30,060 
Prepaid expenses and other current assets   962,021    403,489 
Total current assets   2,496,774    2,604,565 
           
Noncurrent Assets          
Property and equipment - net   58,447    64,784 
Capitalized software - net   680,889    644,828 
Total noncurrent assets   739,336    709,612 
           
Total assets  $3,236,110   $3,314,177 
           
Liabilities and Stockholders’ Equity          
Current Liabilities          
Accounts payable  $56,014   $48,907 
Accrued and other current liabilities:          
Accrued compensation   688,075    655,275 
Deferred revenue   24,375    
-
 
Other accrued liabilities   74,539    94,283 
Total current liabilities   843,003    798,465 
           
Commitments and Contingencies   
 
    
 
 
           
Stockholders’ Equity          
Common stock, $.0001 par value; 100,000,000 shares authorized;  2,792,440 and 2,542,440 shares issued and outstanding at September 30, 2024 and June 30, 2024, respectively.   280    255 
Preferred stock, $.0001 par value; 5,000,000 shares authorized; no shares issued and outstanding at September 30, 2024 and June 30, 2024   
-
    
-
 
Additional paid-in capital   41,134,373    40,348,958 
Accumulated deficit   (38,741,546)   (37,833,501)
Total stockholders’ equity   2,393,107    2,515,712 
           
Total liabilities and stockholders’ equity  $3,236,110   $3,314,177 

 

See accompanying Notes to Condensed Financial Statements.

 

-3-

 

 

Amesite Inc.

Condensed Statements of Operations (unaudited)

 

   Three Months Ended 
   September 30 
   2024   2023 
         
Net Revenue  $11,250   $63,333 
           
Operating Expenses          
General and administrative expenses   633,122    438,262 
Technology and content development   139,658    333,434 
Sales and marketing   165,814    241,627 
Total operating expenses   938,594    1,013,323 
           
Loss from Operations   (927,344)   (949,990)
           
Other Income   
 
    
 
 
Interest income   19,299    59,297 
Total other income   19,299    59,297 
           
Net Loss  $(908,045)  $(890,693)
           
Loss per Share          
Basic and diluted loss per share  $(0.34)  $(0.35)
Weighted average shares outstanding   2,707,275    2,542,440 

 

See accompanying Notes to Condensed Financial Statements.

 

-4-

 

 

Amesite Inc.

Condensed Statement of Stockholders’ Equity (unaudited)

 

           Additional         
   Common Stock   Paid-In   Accumulated     
   Shares   Amount   Capital   Deficit   Total 
Balance - July 1, 2023   2,542,440   $255   $39,514,489   $(33,430,319)  $6,084,425 
Net loss   -    
-
    
-
    (890,693)   (890,693)
Stock-based compensation expense   -    
-
    55,098    
-
    55,098 
Balance - September 30, 2023   2,542,440    255    39,569,587    (34,321,012)   5,248,830 
                          
Balance - July 1, 2024   2,542,440   $255   $40,348,958   $(37,833,501)  $2,515,712 
Net loss   -    
-
    
-
    (908,045)   (908,045)
Issuance of common stock for consulting services   250,000    25    719,975    
-
    720,000 
Stock-based compensation expense   -    
-
    65,440    
-
    65,440 
Balance - September 30, 2024   2,792,440    280    41,134,373    (38,741,546)   2,393,107 

 

See accompanying Notes to Condensed Financial Statements.

 

-5-

 

 

Amesite Inc.

Condensed Statements of Cash Flows (unaudited)

 

   Three Months Ended 
   September 30 
   2024   2023 
Cash Flows from Operating Activities        
Net Loss  $(908,045)  $(890,693)
Adjustments to reconcile change in net loss to net cash used in operating activities:          
Depreciation and amortization   118,275    152,358 
Stock-based compensation expense   65,440    55,098 
Value of common stock issued in exchange for consulting services   720,000    
-
 
Changes in operating assets and liabilities which used cash:          
Accounts receivable   30,060    (3,750)
Prepaid expenses and other current assets   (558,532)   30,210 
Accounts payable   7,109    8,820 
Accrued compensation   32,800    41,400 
Deferred revenue   24,375    (29,583)
Accrued and other liabilities   (19,745)   (22,639)
Net cash and cash equivalents used in operating activities   (488,263)   (658,779)
           
Cash Flows from Investing Activities          
Investment in capitalized software   (148,000)   (65,200)
Net cash and cash equivalents used in investing activities   (148,000)   (65,200)
           
Net decrease in cash and cash equivalents   (636,263)   (723,979)
Cash and cash equivalents - Beginning of period   2,071,016    5,360,661 
Cash and cash equivalents - End of period  $1,434,753   $4,636,682 

 

See accompanying Notes to Condensed Financial Statements.

 

-6-

 

 

Amesite, Inc.

Notes to Condensed Financial Statements (unaudited)

 

September 30, 2024 and 2023

 

Note 1 - Nature of Business and Liquidity

 

Amesite Inc. (the “Company”) was incorporated in November 2017. Amesite is a pioneering technology company specializing in the development and marketing of B2C and B2B AI-driven solutions, including its higher ed platform that offers professional learning. Leveraging its proprietary AI infrastructure, Amesite offers cutting-edge applications that cater to both individual and professional needs. NurseMagic™, the company’s mobile healthcare app, streamlines creation of nursing notes and documentation tasks, enhances patient communication, and offers personalized guidance to nurses on patient care, medications, and handling challenging workplace situations.

 

Note 2 - Significant Accounting Policies

 

Basis of Presentation

 

The condensed financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and considering the requirements of the United States Securities and Exchange Commission (“SEC”). The Company has a fiscal year with a June 30 year end.

 

In the opinion of management, the condensed financial statements of the Company as of September 30, 2024 and 2023 and for the three months ended September 30, 2024 and 2023 include all adjustments and accruals, consisting only of normal, recurring accrual adjustments, which are necessary for a fair presentation of the results for the interim periods. These interim results are not necessarily indicative of results for a full year.

 

Certain information and footnote disclosures normally included in condensed financial statements prepared in accordance with GAAP have been condensed in or omitted from this report pursuant to the rules and regulations of the SEC. These condensed financial statements should be read together with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2024.

 

Going Concern

 

The accompanying condensed financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

 

The Company is developing its customer base and has not completed its efforts to establish a stabilized source of revenue sufficient to cover its expenses. The Company has had a history of net losses and negative cash flows from operating activities since inception and expects to continue to incur net losses and use cash in its operations in the foreseeable future.

 

The assessment of the Company’s ability to meet its future obligations is inherently judgmental, subjective and susceptible to change. Based on their current forecast, management believes that it may not have sufficient cash and cash equivalents to maintain the Company’s planned operations for the next twelve months following the issuance of these condensed financial statements.

 

-7-

 

 

The Company has considered both quantitative and qualitative factors that are known or reasonably known as of the date of these condensed financial statements are issued and concluded that there are conditions present in the aggregate that raise substantial doubt about the Company’s ability to continue as a going concern. In response to the conditions, management plans include generating cash by completing financing transactions, which may include offerings of common stock. However, these plans are subject to market conditions, and are not within the Company’s control, and therefore, cannot be deemed probable. There is no assurance that the Company will be successful in implementing their plans. As a result, the Company has concluded that management’s plans do not alleviate substantial doubt about the Company’s ability to continue as a going concern. The condensed financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.

 

Use of Estimates

 

The preparation of condensed financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

 

Cash and Cash Equivalents

 

The Company considers all investments with an original maturity of three months or less when purchased to be cash equivalents. The total amount of bank deposits (checking and savings accounts) insured by the FDIC at the period ended September 30, 2024 was $250,000.

 

Property and Equipment

 

Property and equipment are recorded at cost. The straight-line method is used for computing depreciation and amortization. Assets are depreciated over their estimated useful lives. The cost of leasehold improvements is depreciated (amortized) over the lesser of the length of the related leases or the estimated useful lives of the assets. Costs of maintenance and repairs are charged to expense when incurred.

 

    Depreciable Life - Years
Leasehold improvements   Shorter of estimated lease term or 10 years
Furniture and fixtures   7 years
Computer equipment and software   5 years

 

Capitalized Software Costs

 

The Company capitalizes costs incurred in the development of software for its customers, including the costs of the software, materials, consultants, and payroll and payroll related costs for employees incurred in developing computer software. Software development projects generally include three stages: the preliminary project stage (all costs are expensed as incurred), the application development stage (certain costs are capitalized and certain costs are expensed as incurred) and the post-implementation/operation stage (all costs are expensed as incurred). Capitalization of costs requires judgment in determining when a project has reached the application development stage, the proportion of time spent in the application development stage, and the period over which we expect to benefit from the use of that software. Once the software is placed in service, these costs are amortized on the straight-line method over the estimated useful life of the software, which is generally three years.

 

-8-

 

 

   Three Months Ended 
   September 30 
   2024   2023 
Beginning capitalized software  $3,993,691   $3,618,990 
Additions   148,000    65,200 
Ending capitalized software  $4,141,691   $3,684,190 
           
Beginning accumulated amortization  $3,348,863   $2,840,545 
Amortization expense   111,939    146,020 
Ending accumulated amortization  $3,460,802   $2,986,565 
           
Capitalized software - net  $680,889   $697,625 

 

Amortization expense for the three months ended September 30, 2024 and 2023 was $111,939 and $146,020, respectively and included as part of “Technology and content development” in the Statements of Operations.

 

Revenue Recognition

 

We generate our revenue from contractual arrangements with businesses, colleges and universities to provide a comprehensive platform of integrated technology and technology enabled services related to product offerings. During the three months ended September 30, 2024 and 2023, we recognized revenue from contracts with customers of $11,250 and $63,333, respectively, related to services provided over time.

 

Performance Obligations and Timing of Recognition

 

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied.

 

This performance obligation is satisfied as the partners receive and consume benefits, which occur ratably over the contract term.

 

Occasionally, we provide professional services, such as custom development, non-complex implementation activities, training, and other various professional services. We evaluate these services to determine if they are distinct and separately identifiable in the context of the contract. In our contracts with customers that contain multiple performance obligations as a result of this assessment, we allocate the transaction price to each separate performance obligation on a relative standalone selling price basis. Standalone selling prices of our solutions and services are typically estimated based on observable transactions when the solutions or services are sold on a standalone basis. When standalone selling prices are not observable, we utilize a cost-plus margin approach to allocate the transaction price.

 

We also receive fees that are fixed in nature, such as annual license and maintenance charges, in place of or in conjunction with variable consideration. The fees are recognized ratably over the service period of the contract that the Company’s platform is made available to the customer (i.e., the customer simultaneously receives and consumes the benefit of the software over the contract service period).

 

For the three months ended September 30, 2024 and 2023, all revenue recognized has been recognized over the related contract periods. For the three months ended September 30, 2024, one customer represents 100% of total revenue.

 

Accounts Receivable, Contract Assets, and Deferred Liabilities

 

Balance sheet items related to contracts consist of accounts receivable (net), contract assets, and deferred liabilities on our condensed balance sheets. Accounts receivable is stated at net realizable value, and we utilize the allowance method to provide for doubtful accounts based on management’s evaluation of the collectability of the amounts due. Our estimates are reviewed and revised periodically based on historical collection experience and a review of the current status of accounts receivable. Historically, actual write-offs for uncollectible accounts have not significantly differed from prior estimates. There was no allowance for doubtful accounts on accounts receivable balances as of September 30, 2024 or June 30, 2024.

 

-9-

 

 

We may recognize revenue prior to billing a customer when we have satisfied or partially satisfied our performance obligations as billings to our customers may not be made until after the service period has commenced. As of September 30, 2024 and June 30, 2024 we do not have any such contract assets.

 

Deferred liabilities as of each balance sheet date represent the excess of amounts billed or received as compared to amounts recognized in revenue on our condensed statements of operations as of the end of the reporting period, and such amounts are reflected as a current liability on our condensed balance sheets as deferred revenue. We generally receive payments prior to completion of the service period and our performance obligations. These payments are recorded as deferred liability until the services are delivered or until our obligations are otherwise met, at which time revenue is recognized.

 

Some contracts also involve annual license fees, for which upfront amounts are received from customers. In these contracts, the license fees received in advance of the platform’s launch are recorded as deferred liabilities.

 

The following table provides information on the changes in the balance of deferred liabilities:

 

   Three Months Ended 
Deferred Revenue  September 30 
   2024   2023 
Opening balance  $0   $53,948 
Plus billings   35,625    33,750 
Less revenue recognized   (11,250)   (63,323)
Closing balance  $24,375   $24,375 

 

Revenue recognized during the three months ended September 30, 2024 and 2023 that was included in the deferred revenue balance that existed in the opening balance of each year was approximately $0 and $26,250, respectively.

 

The deferred revenue balance as of September 30, 2024 is expected to be recognized over the next 7 months.

  

Stock-Based Compensation

 

We have issued four types of stock-based awards under our stock plans: stock options, restricted stock units, deferred stock units, and stock warrants. All stock-based awards granted to employees, directors and independent contractors are measured at fair value at each grant date. We rely on the Black-Scholes option pricing model for estimating the fair value of stock-based awards granted, and expected volatility is based on the historical volatility of the Company’s stock prices. Stock options generally vest over two years from the grant date and generally have ten-year contractual terms. Restricted stock units generally have a term of 12 months from the closing date of the agreement. Stock warrants issued have a term of five years. Information about the assumptions used in the calculation of stock-based compensation expense is set forth in Note 3 in the Notes to Condensed Financial Statements.

 

Technology and Content Development

 

Technology and content development expenditures consist primarily of personnel and personnel-related expense and contracted services associated with the maintenance of our platform as well as hosting and licensing costs and are charged to expense as incurred. It also includes amortization of capitalized software costs and research and development costs related to improving our platform and creating content that are charged to expense as incurred.

 

-10-

 

 

Fair Value Measurements

 

Accounting standards require certain assets and liabilities be reported at fair value in the condensed financial statements and provide a framework for establishing that fair value. The framework for determining fair value is based on a hierarchy that prioritizes the inputs and valuation techniques used to measure fair value.

 

Fair values determined by Level 1 inputs use quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.

 

Fair values determined by Level 2 inputs use other inputs that are observable, either directly or indirectly. These Level 2 inputs include quoted prices for similar assets and liabilities in active markets and other inputs such as interest rates and yield curves that are observable at commonly quoted intervals.

 

Level 3 inputs are unobservable inputs, including inputs that are available in situations where there is little, if any, market activity for the related asset. These Level 3 fair value measurements are based primarily on management’s own estimates using pricing models, discounted cash flow methodologies, or similar techniques.

 

In instances wherein inputs used to measure fair value fall into different levels in the above fair value hierarchy, fair value measurements in their entirety are categorized based on the lowest level input that is significant to the valuation. The Company’s assessment of the significance of particular inputs to these fair value measurements requires judgment and considers factors specific to each asset or liability.

 

Income Taxes

 

A current tax liability or asset is recognized for the estimated taxes payable or refundable on tax returns for the year. Deferred tax liabilities or assets are recognized for the estimated future tax effects of temporary differences between financial reporting and tax accounting.

 

Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statement of operations in the period that includes the enactment date.

 

Net Loss per Share

 

At September 30, 2024 and June 30, 2024, the Company had 636,577 and 633,000 potentially dilutive shares of common stock related to common stock options and warrants, respectively, as determined using the if-converted method. For the three months ended September 30, 2024 and 2023, the dilutive effect of common stock options and common stock warrants has not been included in the average shares outstanding for the calculation of net loss per share as the effect would be anti-dilutive as a result of our net losses in these periods.

 

Subsequent Events

 

The Company evaluated subsequent events through the date of this Form 10-Q and has determined that no events have occurred that would require recognition or disclosure in the condensed financial statements.

 

Risks and Uncertainties

 

The Company operates in an industry subject to rapid change. The Company’s operations will be subject to significant risk and uncertainties including financial, operational, technological, and other risks associated with an early-stage company, including the potential risk of business failure.

  

Note 3 - Stock-Based Compensation

 

The Company’s Equity Incentive Plan (the “Plan”) permits the grant of stock options, stock appreciation rights, restricted stock, restricted stock units, and deferred stock units to officers, employees, directors, consultants, agents, and independent contractors of the Company. The Company believes that such awards align the interests of its employees, directors, and consultants with those of its stockholders.

 

-11-

 

 

Option awards are generally granted with an exercise price equal to the market price of the Company’s stock at the date of grant; those option awards generally vest over four years from the grant date and generally have ten-year contractual terms. Certain option awards provide for accelerated vesting (as defined in the Plan).

 

The Company estimates the fair value of each option award using a Black Scholes Model (“BSM”). Expected volatilities are based on historical volatility of comparable companies. The Company uses historical data to estimate option exercise within the valuation model or estimates the expected option exercise when historical data is unavailable. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The Company has not paid any dividends on common stock since its inception and does not anticipate paying dividends on its common stock in the foreseeable future. When calculating the amount of annual compensation expense, the Company has elected not to estimate forfeitures and instead accounts for forfeitures as they occur.

 

No options were granted for the three months ended September 30, 2024 or 2023. As of September 30, 2024, there were approximately $50,052 of total unrecognized compensation costs for employees and non-employees related to nonvested options. These costs are expected to be recognized through December 2026.

 

A summary of options that vested in the three months ended September 30, 2024 is presented below:

 

Options  Number of
Shares		   Weighted
Average
Exercise
Price		   Weighted
Average
Remaining
Contractual
Term
(in years)		 
Outstanding at July 1, 2024   235,219    22.05    5.46 
Additional vesting   3,577    9.50    8.23 
Outstanding and expected to vest at September 30, 2024   238,796    20.96    5.29 

 

On September 29, 2021, the board of directors approved changes to our director compensation program for fiscal year 2022 and beyond. The board instituted an annual cash retainer for directors in the amount of $48,000 per director with an additional retainer for the chair of our Compensation Committee and Audit Committee of $7,500 and $10,000, respectively. Directors can choose to receive deferred stock units in lieu of cash payments. For the three months ended September 30, 2024, $62,500 in deferred stock units were awarded and $13,875 in cash compensation was accrued.

 

On May 3, 2024, the board of directors of the Company approved an amendment to the Company’s 2018 Equity Incentive Plan (the “2018 Plan”) to increase the number of shares available for issuance under the 2018 Plan by 508,488 shares and increase the number of shares that may be issued pursuant to the exercise of incentive stock options by 508,488 shares. The amendment to the 2018 Plan is intended to ensure that the Company can continue to provide an incentive to employees, directors and consultants by enabling them to share in the Company’s future growth. If approved by the stockholders, all of the additional shares would be available for grant as incentive stock options within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”), or as nonqualified stock options, restricted stock awards, stock appreciation rights, or other kinds of equity-based compensation available under the 2018 Plan. The amendment to the 2018 Plan was approved by the Company’s stockholders at the Company’s special meeting on June 18, 2024.

 

As of September 30, 2024, the Company has 822,524 shares of common stock available for granting under the Plan.

 

On August 1, 2024, the Company issued 250,000 shares of common stock to a consultant under an agreement for activities related to potential future financing. The $720,000 market value of those shares is reflected in the Company’s common stock and additional paid in capital accounts and has been capitalized as deferred issuance costs and shown as a current asset as of September 30, 2024. These costs will be recognized as an expense against the proceeds of a potential future equity issuance, or amortized over the life of the debt of a potential future debt issuance, or if an equity or debt transaction is not executed, then expensed at the conclusion of the contract with the consultant in July 2025.

 

Note 4 - Warrants

 

As of September 30, 2024 and June 30, 2024, there were 397,781 warrants outstanding.

  

The Company measures the fair value of warrants using the Black-Scholes Model. No warrants have been issued during the three months ended September 30, 2024 or the year ended June 30, 2024.

 

Note 5 - Income Taxes

 

For the three months ended September 30, 2024 and prior periods since inception, the Company’s activities have not generated taxable income or tax liabilities. Accordingly, the Company has not recognized an income tax benefit on the Condensed Statements of Operations for the three months ended September 30, 2024 and 2023.

 

The Company has approximately $28.4 million of net operating loss carryforwards available to reduce future income taxes, of which approximately $17,000 of net operating loss carryforwards expire in 2037. Due to uncertainty as to the realization of the net operating loss carryforwards and other deferred tax assets as a result of the Company’s limited operating history and operating losses since inception, a full valuation allowance has been recorded against the Company’s deferred tax assets.

 

-12-

 

 

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

 

The following discussion and analysis of our financial condition and results of operations should be read together with our unaudited condensed financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and our audited financial statements and related notes for the year ended June 30, 2024 included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission, or SEC, on September 30, 2024. In addition to historical information, this discussion and analysis contains forward-looking statements that involve risks, uncertainties, and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors. We discuss factors that we believe could cause or contribute to these differences below and elsewhere in this Quarterly Report on Form 10-Q, including those factors set forth in the section entitled “Cautionary Statement Regarding Forward-Looking Statements” and in the section entitled “Risk Factors” in Part II, Item 1A.

 

Overview

 

The following discussion highlights our results of operations and the principal factors that have affected our financial condition as well as our liquidity and capital resources for the three months ended September 30, 2024 and provides information that management believes is relevant for an assessment and understanding of the statements of financial condition and results of operations presented herein. The following discussion and analysis are based on our unaudited condensed financial statements contained in this Quarterly Report on Form 10-Q, which we have prepared in accordance with United States generally accepted accounting principles, or GAAP, and the requirements of the SEC. You should read the discussion and analysis together with such financial statements and the related notes thereto.

 

The Company is developing its customer base and has not completed its efforts to establish a stabilized source of revenue sufficient to cover its expenses. The Company has had a history of net losses and negative cash flows from operating activities since inception and expects to continue to incur net losses and use cash in its operations in the foreseeable future.

 

We are not currently profitable, and we cannot provide any assurance that we will ever be profitable. We incurred a net loss of $908,045 for the three months ended September 30, 2024, and we incurred a net loss of $38.7 million for the period from November 14, 2017 (date of incorporation) to September 30, 2024.

 

The assessment of the Company’s ability to meet its future obligations is inherently judgmental, subjective and susceptible to change. Based on their current forecast, management believes that it will have sufficient cash and cash equivalents to maintain the Company’s planned operations for the next twelve months following the issuance of these condensed financial statements; however, there is uncertainty in the forecast and therefore the Company cannot assert that it is probable. The Company has considered both quantitative and qualitative factors that are known or reasonably knowable as of the date of these condensed financial statements are issued and concluded that there are conditions present in the aggregate that raise substantial doubt about the Company’s ability to continue as a going concern.

 

In response to the conditions, management plans include generating cash by completing financing transactions, which may include offerings of common stock. However, these plans are subject to market conditions, and are not within the Company’s control, and therefore, cannot be deemed probable. There is no assurance that the Company will be successful in implementing their plans. As a result, the Company has concluded that management’s plans do not alleviate substantial doubt about the Company’s ability to continue as a going concern.

 

Financial Position, Liquidity, and Capital Resources

 

We are not currently profitable, and we cannot provide any assurance that we will ever be profitable. We incurred a net loss of $908,045 for the three months ended September 30, 2024, and we incurred a net loss of $37.8 million for the period from November 14, 2017 (date of incorporation) to September 30, 2024.

 

During the period from November 14, 2017 (date of incorporation) to September 30, 2020, we raised net proceeds of approximately $11,760,000 from private placement financing transactions (stock and debt). On September 25, 2020, we completed the Offering of 250,000 shares of our common stock, $0.0001 par value per share, at an offering price of $60.00 per share (total net proceeds of approximately $12.8 million after underwriting discounts, commissions, and other offering costs).

 

-13-

 

 

On August 2, 2021, we entered into a purchase agreement (the “Purchase Agreement”) with Lincoln Park Capital Fund, LLC (“Lincoln Park”), under which, subject to specified terms and conditions, we may sell up to $16.5 million shares of common stock. Our net proceeds under the Purchase Agreement will depend on the frequency of sales and the number of shares sold to Lincoln Park and the prices at which we sell shares to Lincoln Park. On August 2, 2021, we sold 63,260 shares of our common stock to Lincoln Park in an initial purchase under the Purchase Agreement for a total purchase price of $1,500,000. We also issued 12,727 shares of our common stock to Lincoln Park as consideration for its irrevocable commitment to purchase our common stock under the Purchase Agreement.

 

On February 16, 2022, we closed on a public offering of common stock and received approximately $2.51 million of cash proceeds, net of underwriting discounts, commissions, and other offering costs.

 

On September 1, 2022, we closed on a public offering of common stock and concurrent private placement of warrants and received approximately $1.85 million of cash proceeds, net of underwriting discounts, commissions, and other offering costs.

 

As of September 30, 2024, our cash and cash equivalent balance totaled $1,434,753.

 

Going Concern

 

The accompanying condensed financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

 

The Company is developing its customer base and has not completed its efforts to establish a stabilized source of revenue sufficient to cover its expenses. The Company has had a history of net losses and negative cash flows from operating activities since inception and expects to continue to incur net losses and use cash in its operations in the foreseeable future.

 

The assessment of the Company’s ability to meet its future obligations is inherently judgmental, subjective and susceptible to change. Based on their current forecast, management believes that it may not have sufficient cash and cash equivalents to maintain the Company’s planned operations for the next twelve months following the issuance of these condensed financial statements.

 

The Company has considered both quantitative and qualitative factors that are known or reasonably known as of the date of these condensed financial statements are issued and concluded that there are conditions present in the aggregate that raise substantial doubt about the Company’s ability to continue as a going concern. In response to the conditions, management plans include generating cash by completing financing transactions, which may include offerings of common stock. However, these plans are subject to market conditions, and are not within the Company’s control, and therefore, cannot be deemed probable. There is no assurance that the Company will be successful in implementing their plans. As a result, the Company has concluded that management’s plans do not alleviate substantial doubt about the Company’s ability to continue as a going concern. The condensed financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.

 

Critical Accounting Policies and Significant Judgments and Estimates

 

This management’s discussion and analysis of financial condition and results of operations is based on our condensed financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these condensed financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the condensed financial statements, and the reported amounts of revenue and expenses during the reported period. In accordance with U.S. GAAP, we base our estimates on historical experience and on various other assumptions we believe to be reasonable under the circumstances. Actual results may differ from these estimates if conditions differ from our assumptions. While our significant accounting policies are more fully described in Note 2 in the “Notes to Condensed Financial Statements,” we believe the following accounting policies are critical to the process of making significant judgments and estimates in preparation of our condensed financial statements.

 

-14-

 

 

Cash, Cash Equivalents, including US Treasury Market Fund

 

As of September 30, 2024 and June 30, 2024 our cash and cash equivalents totaled $1,434,753 and $2.071,016, respectively with the majority invested in a short-term US Treasury Fund returning approximately 4.2. The Fund is invested in US Treasuries with a 7-day liquidity. The decision to allocate funds to the short-term US Treasury Fund is based on our investment strategy, which prioritizes liquidity and stability while receiving current rate returns. The returns from the fund for the three months ended September 30, 2024 were 4.2% and in line with our expectations and the broader market trends for similar investment vehicles. We continuously monitor our investment portfolio, considering market conditions and our liquidity needs, ensuring alignment with our broader financial strategy and risk tolerance.

 

Internally Developed Capitalized Software

 

We capitalize certain costs related to the development of software for our customers, primarily consisting of direct labor and third-party vendor costs associated with creating the software. Software development projects generally include three stages: the preliminary project stage (all costs are expensed as incurred), the application development stage (certain costs are capitalized and certain costs are expensed as incurred) and the post-implementation/operation stage (all costs are expensed as incurred). Costs capitalized in the application development stage include costs related to the design and implementation of the selected software components, software build and configuration infrastructure, and software interfaces. Capitalization of costs requires judgment in determining when a project has reached the application development stage, the proportion of time spent in the application development stage, and the period over which we expect to benefit from the use of that software. Once the software is placed in service, these costs are amortized on the straight-line method over the estimated useful life of the software, which is generally three years.

 

The Company capitalized software of $148,000 and $374,700 and recognized amortization expense of $111,939 and $508,318 for the three months ended September 30, 2024 and year ended June 30, 2024, respectively.

 

Results of Operations

 

Revenue Recognition

 

We generate substantially all our revenue from contractual arrangements with businesses, colleges and universities and K-12 schools to provide a comprehensive platform of tightly integrated technology and technology enabled services related to product offerings. Revenue related to our licensing arrangements is generally recognized ratably over the contract term commencing upon platform delivery. Revenue related to licensing arrangements recognized in a given time period will consist of contracts that went live in the current period or that went live in previous periods and are currently ongoing.

 

We have recorded accounts receivable of $0 and $30,600 as of September 30, 2024 and June 30, 2024, respectively. We have set up deferred revenue liabilities at the end of each period to reflect performance obligations to be performed in future periods for our services delivered over time. Future obligations related to deferred revenue totaled $24,375 and $0 as of September 30, 2024 and June 30, 2024 respectively.

 

The majority of our customers are private and public learning institutions across various domestic regions. For the three months ended September 30, 2024, one customer comprised 100% of total revenue.

 

Revenue

 

We generated revenues of $11,250 for the three months ended September 30, 2024 as compared to $63,333 for the three months ended September 30, 2023.

 

-15-

 

 

We have strongly pivoted to grow our customer base while reducing risk and losses, resulting in a larger client base, a short-term reduction in overall revenue and a dramatic reduction in cash burn. Larger, cash-upfront deals were struggling to produce sustainable revenue, as administrative barriers within nonprofits, high price points set by customers, and inability or unwillingness of customers to partner with schools, businesses and other entities to purchase products hampered growth.

 

We continue to believe that AI-powered learning programs, priced affordably, will supplant other academic products in the mid to long term, but have defocused on securing “change agent” customers, and are now offering our academic platform for use by any community college on a fee-per-course basis. The incremental cost to Amesite in delivering the system is de minimis, as the system is turnkey, and the technology stack is robust. We have focused all new development work on delivering AI tools to markets hungry for increased capability that immediately impacts both their performance and their bottom line. The NurseMagicTM app is the first of these and has already gained traction with larger entities.

 

Stock-Based Compensation

 

We issue four types of stock-based awards under our stock plans: stock options, restricted stock units, deferred stock units, and stock warrants. All stock-based awards granted to employees, directors and independent contractors are measured at fair value at each grant date. We rely on the Black-Scholes option pricing model for estimating the fair value of stock-based awards granted, and expected volatility is based on the historical volatility of the Company’s stock prices. Stock options generally vest over two years from the grant date and generally have ten-year contractual terms. Restricted stock units generally have a term of 12 months from the closing date of the agreement. Stock warrants issued have a term of five years. Information about the assumptions used in the calculation of stock-based compensation expense is set forth in Note 3 in the Notes to Condensed Financial Statements.

 

General and Administrative

 

General and administrative expenses consist primarily of personnel and personnel-related expenses, including executive management, legal, finance, human resources and other departments that do not provide direct operational services. General and administrative expenses also include professional fees and other corporate expenses.

 

General and administrative expenses for the three months ended September 30, 2024 were $633,122 as compared to $438,262 for the three months ended September 30, 2023. The increase between the three-month periods is due to the recording of Board Compensation in the current quarter, offset by savings due to deliberate cost reductions, including reductions in headcount and associated administrative costs. These reductions were made possible by completion of certain features and platform capabilities that require less staffing to maintain than to build.

 

Technology and Content Development

 

Technology and content development expenses consist primarily of personnel and personnel-related expenses and contracted services associated with the ongoing improvement and maintenance of our platform as well as hosting and licensing costs. Technology and content expenses also include the amortization of capitalized software costs.

 

Technology and content development expenses for the three months ended September 30, 2024 were $139,658 as compared to $333,434 for the three months ended September 30, 2023. The decreases between the three-month periods in technology reflect the increase in capital asset additions and reductions in headcount and associated administrative costs, since these costs scale with staff.

 

Sales and Marketing

 

Sales and marketing expense consist primarily of activities to attract customers to our offerings. This includes personnel and personnel-related expenses, various search engine and social media costs as well as the cost of advertising.

 

Sales and marketing expenses for the three months ended September 30, 2024 were $165,814 as compared to $241,627 for the three months ended September 30, 2023. The decrease between the three-month periods in sales and marketing are principally related to moving certain marketing functions from outside providers to inside staff.

 

Interest Income

 

For the three months ended September 30, 2024, interest income totaled $19,299 as compared to interest income of $59,297 for the three months ended September 30, 2023.

 

Net Loss

 

Our net loss for the three months ended September 30, 2024 was $908,045 as compared to a net loss for the three months ended September 30, 2023 of $890,693.

 

Capital Expenditures

 

During the three months ended September 30, 2024 and 2023, we had capital asset additions of $148,000 and $65,200, respectively. We will continue to capitalize significant software development costs, comprised primarily of internal payroll, payroll related and contractor costs, as we build out and complete our technology platforms.

 

-16-

 

 

Reverse Split of Stock

 

On February 15, 2023, the Company held a special meeting of stockholders (the “Special Meeting”). At the Special Meeting, the stockholders also approved a proposal to amend the Company’s certificate of incorporation to effect a reverse split of the Company’s outstanding shares of common stock, par value $0.0001 at a specific ratio within a range of one-for five (1-for-5) to a maximum of one-for-fifty (1-for-50) to be determined by the Company’s board of directors in its sole discretion.

 

Following the Special Meeting, the board of directors approved a one-for-twelve (1-for-12) reverse split of the Company’s issued and outstanding shares of common stock (the “Reverse Stock Split”). On February 21, 2023, the Company filed with the Secretary of State of the State of Delaware a certificate of amendment to its certificate of incorporation (the “Certificate of Amendment”) to affect the Reverse Stock Split. The Reverse Stock Split became effective as of 4:01 p.m. Eastern Time on February 21, 2023, and the Company’s common stock began trading on a split-adjusted basis when the Nasdaq Stock Market opens on February 22, 2023.

 

On March 8, 2023, the Company received a letter from The Nasdaq Stock Market LLC (“Nasdaq”) stating that because the Company’s common stock had a closing bid price at or above $1.00 per share for a minimum of 10 consecutive trading days, the Company had regained compliance with the minimum bid price requirement of $1.00 per share for continued listing on The Nasdaq Capital Market, as set forth in Nasdaq Listing Rule 5550(a)(2).

 

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

 

None. 

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

 

The Company is not required to provide the information required by this Item as it is a “smaller reporting company.”

 

Item 4. Controls and Procedures.

 

Evaluation of Disclosure Controls and Procedures

 

As of the end of the period covered by this Quarterly Report on Form 10-Q, we carried out an evaluation, under the supervision, and with the participation of, our management, including our Chief Executive Officer (principal executive officer) and our Chief Financial Officer (principal financial and accounting officer), of the effectiveness of our disclosure controls and procedures as defined in Rule 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (“Exchange Act”). Based on that evaluation, our management concluded that our disclosure controls and procedures were effective.

 

Changes in Internal Controls Over Financial Reporting

 

There were no changes in our internal control over financial reporting that occurred during the period ended September 30, 2024, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

-17-

 

 

PART II – OTHER INFORMATION

 

Item 1. Legal Proceedings.

 

None.

 

Item 1A. Risk Factors.

 

Our business, financial condition, results of operations, and cash flows may be impacted by a number of factors, many of which are beyond our control, including those set forth in our Annual Report on Form 10-K, the occurrence of any one of which could have a material adverse effect on our actual results. There have been no material changes in our risk factors from those previously disclosed in our Annual Report on Form 10-K.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

 

None.

 

Item 3. Defaults Upon Senior Securities.

 

None.

 

Item 4. Mine Safety Disclosures.

 

Not applicable.

 

Item 5. Other Information.

 

During the quarter ended September 30, 2024, none of our directors or officers (as defined in Rule 16a-1(f) of the Exchange Act) adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K.

 

-18-

 

 

Item 6. Exhibits

 

Exhibit       Incorporated by Reference   Filed
Number   Exhibit Description   Form   File No.   Exhibit   Filing Date   Herewith
                         
3.1   Certificate of Incorporation of the Registrant   10-Q   001-39553   3.1   November 16,
2020		    
                         
3.2   Bylaws of the Registrant   10-Q   001-39553   3.2   November 16,
2020		    
                         
31.1   Certification of Chief Executive Officer filed pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a) of the Securities and Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                   X
                         
31.2   Certification of Chief Financial Officer filed pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a) of the Securities and Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                   X
                         
32.1*   Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                   X
                         
32.2*   Certification by Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                   X
                         
101.INS   Inline XBRL Instance Document                   X
                         
101.SCH   Inline XBRL Taxonomy Extension Schema Document                   X
                         
101.CAL   Inline XBRL Taxonomy Extension Calculation Linkbase Document                   X
                         
101.DEF   Inline XBRL Taxonomy Extension Definition Linkbase Document                   X
                         
101.LAB   Inline XBRL Taxonomy Extension Label Linkbase Document                   X
                         
101.PRE   Inline XBRL Taxonomy Extension Presentation Linkbase Document                   X
                         
104   Cover Page Interactive Data File - the cover page from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2024 is formatted in Inline XBRL                   X

 

* This certification is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (Exchange Act), or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act.

 

-19-

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

  AMESITE INC.
     
Date: November 14, 2024 By: /s/ Ann Marie Sastry
    Ann Marie Sastry, Ph.D.
    Chief Executive Officer
    (Principal Executive Officer)

 

Date: November 14, 2024 By: /s/ Sherlyn W. Farrell
    Sherlyn W. Farrell
    Chief Financial Officer
    (Principal Financial Officer)
    (Principal Accounting Officer)

 

 

-20-

 

 

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Exhibit 31.1

 

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Ann Marie Sastry, Ph.D., certify that:

 

(1) I have reviewed this Quarterly Report on Form 10-Q of Amesite Inc.;
   
(2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
   
(3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
   
(4) The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

  (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
     
  (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
     
  (c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
     
  (d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

(5) The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

  (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
     
  (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

November 14, 2024 By: /s/ Ann Marie Sastry, Ph.D.
    Ann Marie Sastry, Ph.D.
    Chief Executive Officer
(Principal Executive Officer)

 

 

Exhibit 31.2

 

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Sherlyn W. Farrell, certify that:

 

(1) I have reviewed this Quarterly Report on Form 10-Q of Amesite Inc.;
   
(2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
   
(3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
   
(4) The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

  (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
     
  (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
     
  (c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
     
  (d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

(5) The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

  (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
     
  (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

November 14, 2024 By: /s/ Sherlyn W. Farrell
    Sherlyn W. Farrell
    Chief Financial Officer
(Principal Financial and Accounting Officer)

 

 

Exhibit 32.1

 

CERTIFICATION PURSUANT

TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the accompanying Quarterly Report on Form 10-Q of Amesite Inc. for the period ended September 30, 2024 (the “Report”), the undersigned hereby certifies in her capacity as Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to my knowledge and belief, that:

 

  (1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
     
  (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Amesite Inc.

 

November 14, 2024 By: /s/ Ann Marie Sastry, Ph.D.
    Ann Marie Sastry, Ph.D.
    Chief Executive Officer
    (Principal Executive Officer)

 

The certification set forth above is being furnished as an Exhibit solely pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and is not being filed as part of the Report or as a separate disclosure document of Amesite Inc. or the certifying officers.

 

 

Exhibit 32.2

 

CERTIFICATION PURSUANT

TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the accompanying Quarterly Report on Form 10-Q of Amesite Inc. for the period ended September 30, 2024 (the “Report”), the undersigned hereby certifies in her capacity as Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to my knowledge and belief, that:

 

  (1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
     
  (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Amesite Inc.

 

November 14, 2024 By: /s/ Sherlyn W. Farrell
    Sherlyn W. Farrell
    Chief Financial Officer
    (Principal Financial and Accounting Officer)

 

The certification set forth above is being furnished as an Exhibit solely pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and is not being filed as part of the Report or as a separate disclosure document of Amesite Inc. or the certifying officers.

 

 

v3.24.3
Cover - shares
 3 Months Ended
Sep. 30, 2024
Nov. 14, 2024
Document Information [Line Items]    
Document Type 10-Q  
Document Quarterly Report true  
Document Transition Report false  
Entity Interactive Data Current Yes  
Amendment Flag false  
Document Period End Date Sep. 30, 2024  
Document Fiscal Year Focus 2025  
Document Fiscal Period Focus Q1  
Entity Information [Line Items]    
Entity Registrant Name AMESITE INC.  
Entity Central Index Key 0001807166  
Entity File Number 001-39553  
Entity Tax Identification Number 82-3431718  
Entity Incorporation, State or Country Code DE  
Current Fiscal Year End Date --06-30  
Entity Current Reporting Status Yes  
Entity Shell Company false  
Entity Filer Category Non-accelerated Filer  
Entity Small Business true  
Entity Emerging Growth Company true  
Entity Ex Transition Period false  
Entity Contact Personnel [Line Items]    
Entity Address, Address Line One 607 Shelby Street  
Entity Address, Address Line Two Suite 700 PMB 214  
Entity Address, City or Town Detroit  
Entity Address, State or Province MI  
Entity Address, Postal Zip Code 48226  
Entity Phone Fax Numbers [Line Items]    
City Area Code (734)  
Local Phone Number 876-8130  
Entity Listings [Line Items]    
Title of 12(b) Security Common Stock, par value $0.0001  
Trading Symbol AMST  
Security Exchange Name NASDAQ  
Entity Common Stock, Shares Outstanding   2,792,440
v3.24.3
Condensed Balance Sheets (Unaudited) - USD ($)
Sep. 30, 2024
Jun. 30, 2024
Current Assets    
Cash and cash equivalents $ 1,434,753 $ 2,071,016
Restricted cash 100,000 100,000
Accounts receivable 30,060
Prepaid expenses and other current assets 962,021 403,489
Total current assets 2,496,774 2,604,565
Noncurrent Assets    
Property and equipment - net 58,447 64,784
Capitalized software - net 680,889 644,828
Total noncurrent assets 739,336 709,612
Total assets 3,236,110 3,314,177
Current Liabilities    
Accounts payable 56,014 48,907
Accrued compensation 688,075 655,275
Deferred revenue 24,375
Other accrued liabilities 74,539 94,283
Total current liabilities 843,003 798,465
Commitments and Contingencies
Stockholders’ Equity    
Common stock, $.0001 par value; 100,000,000 shares authorized; 2,792,440 and 2,542,440 shares issued and outstanding at September 30, 2024 and June 30, 2024, respectively. 280 255
Preferred stock, $.0001 par value; 5,000,000 shares authorized; no shares issued and outstanding at September 30, 2024 and June 30, 2024
Additional paid-in capital 41,134,373 40,348,958
Accumulated deficit (38,741,546) (37,833,501)
Total stockholders’ equity 2,393,107 2,515,712
Total liabilities and stockholders’ equity $ 3,236,110 $ 3,314,177
v3.24.3
Condensed Balance Sheets (Unaudited) (Parentheticals) - $ / shares
Sep. 30, 2024
Jun. 30, 2024
Statement of Financial Position [Abstract]    
Common stock, par value (in Dollars per share) $ 0.0001 $ 0.0001
Common stock, shares authorized 100,000,000 100,000,000
Common stock, shares issued 2,792,440 2,542,440
Common stock, shares outstanding 2,792,440 2,542,440
Preferred stock, par value (in Dollars per share) $ 0.0001 $ 0.0001
Preferred stock, shares authorized 5,000,000 5,000,000
Preferred stock, shares issued
Preferred stock, shares outstanding
v3.24.3
Condensed Statements of Operations (Unaudited) - USD ($)
 3 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Income Statement [Abstract]    
Net Revenue $ 11,250 $ 63,333
Operating Expenses    
General and administrative expenses 633,122 438,262
Technology and content development 139,658 333,434
Sales and marketing 165,814 241,627
Total operating expenses 938,594 1,013,323
Loss from Operations (927,344) (949,990)
Other Income
Interest income 19,299 59,297
Total other income 19,299 59,297
Net Loss $ (908,045) $ (890,693)
Loss per Share    
Basic loss per share (in Dollars per share) $ (0.34) $ (0.35)
Diluted loss per share (in Dollars per share) $ (0.34) $ (0.35)
Weighted average shares outstanding (in Shares) 2,707,275 2,542,440
v3.24.3
Condensed Statement of Stockholders’ Equity (Unaudited) - USD ($)
Common Stock
Additional Paid-In Capital
Accumulated Deficit
Total
Balance at Jun. 30, 2023 $ 255 $ 39,514,489 $ (33,430,319) $ 6,084,425
Balance (in Shares) at Jun. 30, 2023 2,542,440      
Net loss (890,693) (890,693)
Stock-based compensation expense 55,098 55,098
Balance at Sep. 30, 2023 $ 255 39,569,587 (34,321,012) 5,248,830
Balance (in Shares) at Sep. 30, 2023 2,542,440      
Balance at Jun. 30, 2024 $ 255 40,348,958 (37,833,501) 2,515,712
Balance (in Shares) at Jun. 30, 2024 2,542,440      
Net loss (908,045) (908,045)
Issuance of common stock for consulting services $ 25 719,975 720,000
Issuance of common stock for consulting services (in Shares) 250,000      
Stock-based compensation expense 65,440 65,440
Balance at Sep. 30, 2024 $ 280 $ 41,134,373 $ (38,741,546) $ 2,393,107
Balance (in Shares) at Sep. 30, 2024 2,792,440      
v3.24.3
Condensed Statements of Cash Flows (Unaudited) - USD ($)
 3 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Cash Flows from Operating Activities    
Net Loss $ (908,045) $ (890,693)
Adjustments to reconcile change in net loss to net cash used in operating activities:    
Depreciation and amortization 118,275 152,358
Stock-based compensation expense 65,440 55,098
Value of common stock issued in exchange for consulting services 720,000
Changes in operating assets and liabilities which used cash:    
Accounts receivable 30,060 (3,750)
Prepaid expenses and other current assets (558,532) 30,210
Accounts payable 7,109 8,820
Accrued compensation 32,800 41,400
Deferred revenue 24,375 (29,583)
Accrued and other liabilities (19,745) (22,639)
Net cash and cash equivalents used in operating activities (488,263) (658,779)
Cash Flows from Investing Activities    
Investment in capitalized software (148,000) (65,200)
Net cash and cash equivalents used in investing activities (148,000) (65,200)
Net decrease in cash and cash equivalents (636,263) (723,979)
Cash and cash equivalents - Beginning of period 2,071,016 5,360,661
Cash and cash equivalents - End of period $ 1,434,753 $ 4,636,682
v3.24.3
Nature of Business and Liquidity
 3 Months Ended
Sep. 30, 2024
Nature of Business and Liquidity [Abstract]  
Nature of Business and Liquidity

Note 1 - Nature of Business and Liquidity

 

Amesite Inc. (the “Company”) was incorporated in November 2017. Amesite is a pioneering technology company specializing in the development and marketing of B2C and B2B AI-driven solutions, including its higher ed platform that offers professional learning. Leveraging its proprietary AI infrastructure, Amesite offers cutting-edge applications that cater to both individual and professional needs. NurseMagic™, the company’s mobile healthcare app, streamlines creation of nursing notes and documentation tasks, enhances patient communication, and offers personalized guidance to nurses on patient care, medications, and handling challenging workplace situations.
v3.24.3
Significant Accounting Policies
 3 Months Ended
Sep. 30, 2024
Significant Accounting Policies [Abstract]  
Significant Accounting Policies

Note 2 - Significant Accounting Policies

 

Basis of Presentation

 

The condensed financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and considering the requirements of the United States Securities and Exchange Commission (“SEC”). The Company has a fiscal year with a June 30 year end.

 

In the opinion of management, the condensed financial statements of the Company as of September 30, 2024 and 2023 and for the three months ended September 30, 2024 and 2023 include all adjustments and accruals, consisting only of normal, recurring accrual adjustments, which are necessary for a fair presentation of the results for the interim periods. These interim results are not necessarily indicative of results for a full year.

 

Certain information and footnote disclosures normally included in condensed financial statements prepared in accordance with GAAP have been condensed in or omitted from this report pursuant to the rules and regulations of the SEC. These condensed financial statements should be read together with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2024.

 

Going Concern

 

The accompanying condensed financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

 

The Company is developing its customer base and has not completed its efforts to establish a stabilized source of revenue sufficient to cover its expenses. The Company has had a history of net losses and negative cash flows from operating activities since inception and expects to continue to incur net losses and use cash in its operations in the foreseeable future.

 

The assessment of the Company’s ability to meet its future obligations is inherently judgmental, subjective and susceptible to change. Based on their current forecast, management believes that it may not have sufficient cash and cash equivalents to maintain the Company’s planned operations for the next twelve months following the issuance of these condensed financial statements.

 

The Company has considered both quantitative and qualitative factors that are known or reasonably known as of the date of these condensed financial statements are issued and concluded that there are conditions present in the aggregate that raise substantial doubt about the Company’s ability to continue as a going concern. In response to the conditions, management plans include generating cash by completing financing transactions, which may include offerings of common stock. However, these plans are subject to market conditions, and are not within the Company’s control, and therefore, cannot be deemed probable. There is no assurance that the Company will be successful in implementing their plans. As a result, the Company has concluded that management’s plans do not alleviate substantial doubt about the Company’s ability to continue as a going concern. The condensed financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.

 

Use of Estimates

 

The preparation of condensed financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

 

Cash and Cash Equivalents

 

The Company considers all investments with an original maturity of three months or less when purchased to be cash equivalents. The total amount of bank deposits (checking and savings accounts) insured by the FDIC at the period ended September 30, 2024 was $250,000.

 

Property and Equipment

 

Property and equipment are recorded at cost. The straight-line method is used for computing depreciation and amortization. Assets are depreciated over their estimated useful lives. The cost of leasehold improvements is depreciated (amortized) over the lesser of the length of the related leases or the estimated useful lives of the assets. Costs of maintenance and repairs are charged to expense when incurred.

 

    Depreciable Life - Years
Leasehold improvements   Shorter of estimated lease term or 10 years
Furniture and fixtures   7 years
Computer equipment and software   5 years

 

Capitalized Software Costs

 

The Company capitalizes costs incurred in the development of software for its customers, including the costs of the software, materials, consultants, and payroll and payroll related costs for employees incurred in developing computer software. Software development projects generally include three stages: the preliminary project stage (all costs are expensed as incurred), the application development stage (certain costs are capitalized and certain costs are expensed as incurred) and the post-implementation/operation stage (all costs are expensed as incurred). Capitalization of costs requires judgment in determining when a project has reached the application development stage, the proportion of time spent in the application development stage, and the period over which we expect to benefit from the use of that software. Once the software is placed in service, these costs are amortized on the straight-line method over the estimated useful life of the software, which is generally three years.

 

   Three Months Ended 
   September 30 
   2024   2023 
Beginning capitalized software  $3,993,691   $3,618,990 
Additions   148,000    65,200 
Ending capitalized software  $4,141,691   $3,684,190 
           
Beginning accumulated amortization  $3,348,863   $2,840,545 
Amortization expense   111,939    146,020 
Ending accumulated amortization  $3,460,802   $2,986,565 
           
Capitalized software - net  $680,889   $697,625 

 

Amortization expense for the three months ended September 30, 2024 and 2023 was $111,939 and $146,020, respectively and included as part of “Technology and content development” in the Statements of Operations.

 

Revenue Recognition

 

We generate our revenue from contractual arrangements with businesses, colleges and universities to provide a comprehensive platform of integrated technology and technology enabled services related to product offerings. During the three months ended September 30, 2024 and 2023, we recognized revenue from contracts with customers of $11,250 and $63,333, respectively, related to services provided over time.

 

Performance Obligations and Timing of Recognition

 

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied.

 

This performance obligation is satisfied as the partners receive and consume benefits, which occur ratably over the contract term.

 

Occasionally, we provide professional services, such as custom development, non-complex implementation activities, training, and other various professional services. We evaluate these services to determine if they are distinct and separately identifiable in the context of the contract. In our contracts with customers that contain multiple performance obligations as a result of this assessment, we allocate the transaction price to each separate performance obligation on a relative standalone selling price basis. Standalone selling prices of our solutions and services are typically estimated based on observable transactions when the solutions or services are sold on a standalone basis. When standalone selling prices are not observable, we utilize a cost-plus margin approach to allocate the transaction price.

 

We also receive fees that are fixed in nature, such as annual license and maintenance charges, in place of or in conjunction with variable consideration. The fees are recognized ratably over the service period of the contract that the Company’s platform is made available to the customer (i.e., the customer simultaneously receives and consumes the benefit of the software over the contract service period).

 

For the three months ended September 30, 2024 and 2023, all revenue recognized has been recognized over the related contract periods. For the three months ended September 30, 2024, one customer represents 100% of total revenue.

 

Accounts Receivable, Contract Assets, and Deferred Liabilities

 

Balance sheet items related to contracts consist of accounts receivable (net), contract assets, and deferred liabilities on our condensed balance sheets. Accounts receivable is stated at net realizable value, and we utilize the allowance method to provide for doubtful accounts based on management’s evaluation of the collectability of the amounts due. Our estimates are reviewed and revised periodically based on historical collection experience and a review of the current status of accounts receivable. Historically, actual write-offs for uncollectible accounts have not significantly differed from prior estimates. There was no allowance for doubtful accounts on accounts receivable balances as of September 30, 2024 or June 30, 2024.

 

We may recognize revenue prior to billing a customer when we have satisfied or partially satisfied our performance obligations as billings to our customers may not be made until after the service period has commenced. As of September 30, 2024 and June 30, 2024 we do not have any such contract assets.

 

Deferred liabilities as of each balance sheet date represent the excess of amounts billed or received as compared to amounts recognized in revenue on our condensed statements of operations as of the end of the reporting period, and such amounts are reflected as a current liability on our condensed balance sheets as deferred revenue. We generally receive payments prior to completion of the service period and our performance obligations. These payments are recorded as deferred liability until the services are delivered or until our obligations are otherwise met, at which time revenue is recognized.

 

Some contracts also involve annual license fees, for which upfront amounts are received from customers. In these contracts, the license fees received in advance of the platform’s launch are recorded as deferred liabilities.

 

The following table provides information on the changes in the balance of deferred liabilities:

 

   Three Months Ended 
Deferred Revenue  September 30 
   2024   2023 
Opening balance  $0   $53,948 
Plus billings   35,625    33,750 
Less revenue recognized   (11,250)   (63,323)
Closing balance  $24,375   $24,375 

 

Revenue recognized during the three months ended September 30, 2024 and 2023 that was included in the deferred revenue balance that existed in the opening balance of each year was approximately $0 and $26,250, respectively.

 

The deferred revenue balance as of September 30, 2024 is expected to be recognized over the next 7 months.

  

Stock-Based Compensation

 

We have issued four types of stock-based awards under our stock plans: stock options, restricted stock units, deferred stock units, and stock warrants. All stock-based awards granted to employees, directors and independent contractors are measured at fair value at each grant date. We rely on the Black-Scholes option pricing model for estimating the fair value of stock-based awards granted, and expected volatility is based on the historical volatility of the Company’s stock prices. Stock options generally vest over two years from the grant date and generally have ten-year contractual terms. Restricted stock units generally have a term of 12 months from the closing date of the agreement. Stock warrants issued have a term of five years. Information about the assumptions used in the calculation of stock-based compensation expense is set forth in Note 3 in the Notes to Condensed Financial Statements.

 

Technology and Content Development

 

Technology and content development expenditures consist primarily of personnel and personnel-related expense and contracted services associated with the maintenance of our platform as well as hosting and licensing costs and are charged to expense as incurred. It also includes amortization of capitalized software costs and research and development costs related to improving our platform and creating content that are charged to expense as incurred.

 

Fair Value Measurements

 

Accounting standards require certain assets and liabilities be reported at fair value in the condensed financial statements and provide a framework for establishing that fair value. The framework for determining fair value is based on a hierarchy that prioritizes the inputs and valuation techniques used to measure fair value.

 

Fair values determined by Level 1 inputs use quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.

 

Fair values determined by Level 2 inputs use other inputs that are observable, either directly or indirectly. These Level 2 inputs include quoted prices for similar assets and liabilities in active markets and other inputs such as interest rates and yield curves that are observable at commonly quoted intervals.

 

Level 3 inputs are unobservable inputs, including inputs that are available in situations where there is little, if any, market activity for the related asset. These Level 3 fair value measurements are based primarily on management’s own estimates using pricing models, discounted cash flow methodologies, or similar techniques.

 

In instances wherein inputs used to measure fair value fall into different levels in the above fair value hierarchy, fair value measurements in their entirety are categorized based on the lowest level input that is significant to the valuation. The Company’s assessment of the significance of particular inputs to these fair value measurements requires judgment and considers factors specific to each asset or liability.

 

Income Taxes

 

A current tax liability or asset is recognized for the estimated taxes payable or refundable on tax returns for the year. Deferred tax liabilities or assets are recognized for the estimated future tax effects of temporary differences between financial reporting and tax accounting.

 

Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statement of operations in the period that includes the enactment date.

 

Net Loss per Share

 

At September 30, 2024 and June 30, 2024, the Company had 636,577 and 633,000 potentially dilutive shares of common stock related to common stock options and warrants, respectively, as determined using the if-converted method. For the three months ended September 30, 2024 and 2023, the dilutive effect of common stock options and common stock warrants has not been included in the average shares outstanding for the calculation of net loss per share as the effect would be anti-dilutive as a result of our net losses in these periods.

 

Subsequent Events

 

The Company evaluated subsequent events through the date of this Form 10-Q and has determined that no events have occurred that would require recognition or disclosure in the condensed financial statements.

 

Risks and Uncertainties

 

The Company operates in an industry subject to rapid change. The Company’s operations will be subject to significant risk and uncertainties including financial, operational, technological, and other risks associated with an early-stage company, including the potential risk of business failure.
v3.24.3
Stock-Based Compensation
 3 Months Ended
Sep. 30, 2024
Stock-Based Compensation [Abstract]  
Stock-Based Compensation

Note 3 - Stock-Based Compensation

 

The Company’s Equity Incentive Plan (the “Plan”) permits the grant of stock options, stock appreciation rights, restricted stock, restricted stock units, and deferred stock units to officers, employees, directors, consultants, agents, and independent contractors of the Company. The Company believes that such awards align the interests of its employees, directors, and consultants with those of its stockholders.

 

Option awards are generally granted with an exercise price equal to the market price of the Company’s stock at the date of grant; those option awards generally vest over four years from the grant date and generally have ten-year contractual terms. Certain option awards provide for accelerated vesting (as defined in the Plan).

 

The Company estimates the fair value of each option award using a Black Scholes Model (“BSM”). Expected volatilities are based on historical volatility of comparable companies. The Company uses historical data to estimate option exercise within the valuation model or estimates the expected option exercise when historical data is unavailable. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The Company has not paid any dividends on common stock since its inception and does not anticipate paying dividends on its common stock in the foreseeable future. When calculating the amount of annual compensation expense, the Company has elected not to estimate forfeitures and instead accounts for forfeitures as they occur.

 

No options were granted for the three months ended September 30, 2024 or 2023. As of September 30, 2024, there were approximately $50,052 of total unrecognized compensation costs for employees and non-employees related to nonvested options. These costs are expected to be recognized through December 2026.

 

A summary of options that vested in the three months ended September 30, 2024 is presented below:

 

Options  Number of
Shares		   Weighted
Average
Exercise
Price		   Weighted
Average
Remaining
Contractual
Term
(in years)		 
Outstanding at July 1, 2024   235,219    22.05    5.46 
Additional vesting   3,577    9.50    8.23 
Outstanding and expected to vest at September 30, 2024   238,796    20.96    5.29 

 

On September 29, 2021, the board of directors approved changes to our director compensation program for fiscal year 2022 and beyond. The board instituted an annual cash retainer for directors in the amount of $48,000 per director with an additional retainer for the chair of our Compensation Committee and Audit Committee of $7,500 and $10,000, respectively. Directors can choose to receive deferred stock units in lieu of cash payments. For the three months ended September 30, 2024, $62,500 in deferred stock units were awarded and $13,875 in cash compensation was accrued.

 

On May 3, 2024, the board of directors of the Company approved an amendment to the Company’s 2018 Equity Incentive Plan (the “2018 Plan”) to increase the number of shares available for issuance under the 2018 Plan by 508,488 shares and increase the number of shares that may be issued pursuant to the exercise of incentive stock options by 508,488 shares. The amendment to the 2018 Plan is intended to ensure that the Company can continue to provide an incentive to employees, directors and consultants by enabling them to share in the Company’s future growth. If approved by the stockholders, all of the additional shares would be available for grant as incentive stock options within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”), or as nonqualified stock options, restricted stock awards, stock appreciation rights, or other kinds of equity-based compensation available under the 2018 Plan. The amendment to the 2018 Plan was approved by the Company’s stockholders at the Company’s special meeting on June 18, 2024.

 

As of September 30, 2024, the Company has 822,524 shares of common stock available for granting under the Plan.

 

On August 1, 2024, the Company issued 250,000 shares of common stock to a consultant under an agreement for activities related to potential future financing. The $720,000 market value of those shares is reflected in the Company’s common stock and additional paid in capital accounts and has been capitalized as deferred issuance costs and shown as a current asset as of September 30, 2024. These costs will be recognized as an expense against the proceeds of a potential future equity issuance, or amortized over the life of the debt of a potential future debt issuance, or if an equity or debt transaction is not executed, then expensed at the conclusion of the contract with the consultant in July 2025.
v3.24.3
Warrants
 3 Months Ended
Sep. 30, 2024
Warrants [Abstract]  
Warrants

Note 4 - Warrants

 

As of September 30, 2024 and June 30, 2024, there were 397,781 warrants outstanding.

  

The Company measures the fair value of warrants using the Black-Scholes Model. No warrants have been issued during the three months ended September 30, 2024 or the year ended June 30, 2024.
v3.24.3
Income Taxes
 3 Months Ended
Sep. 30, 2024
Income Taxes [Abstract]  
Income Taxes

Note 5 - Income Taxes

 

For the three months ended September 30, 2024 and prior periods since inception, the Company’s activities have not generated taxable income or tax liabilities. Accordingly, the Company has not recognized an income tax benefit on the Condensed Statements of Operations for the three months ended September 30, 2024 and 2023.

 

The Company has approximately $28.4 million of net operating loss carryforwards available to reduce future income taxes, of which approximately $17,000 of net operating loss carryforwards expire in 2037. Due to uncertainty as to the realization of the net operating loss carryforwards and other deferred tax assets as a result of the Company’s limited operating history and operating losses since inception, a full valuation allowance has been recorded against the Company’s deferred tax assets.
v3.24.3
Pay vs Performance Disclosure - USD ($)
 3 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Pay vs Performance Disclosure    
Net Income (Loss) $ (908,045) $ (890,693)
v3.24.3
Insider Trading Arrangements
 3 Months Ended
Sep. 30, 2024
Trading Arrangements, by Individual  
Rule 10b5-1 Arrangement Adopted false
Non-Rule 10b5-1 Arrangement Adopted false
Rule 10b5-1 Arrangement Terminated false
Non-Rule 10b5-1 Arrangement Terminated false
v3.24.3
Accounting Policies, by Policy (Policies)
 3 Months Ended
Sep. 30, 2024
Significant Accounting Policies [Abstract]  
Basis of Presentation

Basis of Presentation

The condensed financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and considering the requirements of the United States Securities and Exchange Commission (“SEC”). The Company has a fiscal year with a June 30 year end.

In the opinion of management, the condensed financial statements of the Company as of September 30, 2024 and 2023 and for the three months ended September 30, 2024 and 2023 include all adjustments and accruals, consisting only of normal, recurring accrual adjustments, which are necessary for a fair presentation of the results for the interim periods. These interim results are not necessarily indicative of results for a full year.

Certain information and footnote disclosures normally included in condensed financial statements prepared in accordance with GAAP have been condensed in or omitted from this report pursuant to the rules and regulations of the SEC. These condensed financial statements should be read together with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2024.
Going Concern

Going Concern

The accompanying condensed financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

The Company is developing its customer base and has not completed its efforts to establish a stabilized source of revenue sufficient to cover its expenses. The Company has had a history of net losses and negative cash flows from operating activities since inception and expects to continue to incur net losses and use cash in its operations in the foreseeable future.

The assessment of the Company’s ability to meet its future obligations is inherently judgmental, subjective and susceptible to change. Based on their current forecast, management believes that it may not have sufficient cash and cash equivalents to maintain the Company’s planned operations for the next twelve months following the issuance of these condensed financial statements.

 

The Company has considered both quantitative and qualitative factors that are known or reasonably known as of the date of these condensed financial statements are issued and concluded that there are conditions present in the aggregate that raise substantial doubt about the Company’s ability to continue as a going concern. In response to the conditions, management plans include generating cash by completing financing transactions, which may include offerings of common stock. However, these plans are subject to market conditions, and are not within the Company’s control, and therefore, cannot be deemed probable. There is no assurance that the Company will be successful in implementing their plans. As a result, the Company has concluded that management’s plans do not alleviate substantial doubt about the Company’s ability to continue as a going concern. The condensed financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.
Use of Estimates

Use of Estimates

The preparation of condensed financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Cash and Cash Equivalents

Cash and Cash Equivalents

The Company considers all investments with an original maturity of three months or less when purchased to be cash equivalents. The total amount of bank deposits (checking and savings accounts) insured by the FDIC at the period ended September 30, 2024 was $250,000.
Property and Equipment

Property and Equipment

Property and equipment are recorded at cost. The straight-line method is used for computing depreciation and amortization. Assets are depreciated over their estimated useful lives. The cost of leasehold improvements is depreciated (amortized) over the lesser of the length of the related leases or the estimated useful lives of the assets. Costs of maintenance and repairs are charged to expense when incurred.

    Depreciable Life - Years
Leasehold improvements   Shorter of estimated lease term or 10 years
Furniture and fixtures   7 years
Computer equipment and software   5 years
Capitalized Software Costs

Capitalized Software Costs

The Company capitalizes costs incurred in the development of software for its customers, including the costs of the software, materials, consultants, and payroll and payroll related costs for employees incurred in developing computer software. Software development projects generally include three stages: the preliminary project stage (all costs are expensed as incurred), the application development stage (certain costs are capitalized and certain costs are expensed as incurred) and the post-implementation/operation stage (all costs are expensed as incurred). Capitalization of costs requires judgment in determining when a project has reached the application development stage, the proportion of time spent in the application development stage, and the period over which we expect to benefit from the use of that software. Once the software is placed in service, these costs are amortized on the straight-line method over the estimated useful life of the software, which is generally three years.

 

   Three Months Ended 
   September 30 
   2024   2023 
Beginning capitalized software  $3,993,691   $3,618,990 
Additions   148,000    65,200 
Ending capitalized software  $4,141,691   $3,684,190 
           
Beginning accumulated amortization  $3,348,863   $2,840,545 
Amortization expense   111,939    146,020 
Ending accumulated amortization  $3,460,802   $2,986,565 
           
Capitalized software - net  $680,889   $697,625 

Amortization expense for the three months ended September 30, 2024 and 2023 was $111,939 and $146,020, respectively and included as part of “Technology and content development” in the Statements of Operations.
Revenue Recognition

Revenue Recognition

We generate our revenue from contractual arrangements with businesses, colleges and universities to provide a comprehensive platform of integrated technology and technology enabled services related to product offerings. During the three months ended September 30, 2024 and 2023, we recognized revenue from contracts with customers of $11,250 and $63,333, respectively, related to services provided over time.

Performance Obligations and Timing of Recognition

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied.

This performance obligation is satisfied as the partners receive and consume benefits, which occur ratably over the contract term.

Occasionally, we provide professional services, such as custom development, non-complex implementation activities, training, and other various professional services. We evaluate these services to determine if they are distinct and separately identifiable in the context of the contract. In our contracts with customers that contain multiple performance obligations as a result of this assessment, we allocate the transaction price to each separate performance obligation on a relative standalone selling price basis. Standalone selling prices of our solutions and services are typically estimated based on observable transactions when the solutions or services are sold on a standalone basis. When standalone selling prices are not observable, we utilize a cost-plus margin approach to allocate the transaction price.

We also receive fees that are fixed in nature, such as annual license and maintenance charges, in place of or in conjunction with variable consideration. The fees are recognized ratably over the service period of the contract that the Company’s platform is made available to the customer (i.e., the customer simultaneously receives and consumes the benefit of the software over the contract service period).

For the three months ended September 30, 2024 and 2023, all revenue recognized has been recognized over the related contract periods. For the three months ended September 30, 2024, one customer represents 100% of total revenue.

Accounts Receivable, Contract Assets, and Deferred Liabilities

Balance sheet items related to contracts consist of accounts receivable (net), contract assets, and deferred liabilities on our condensed balance sheets. Accounts receivable is stated at net realizable value, and we utilize the allowance method to provide for doubtful accounts based on management’s evaluation of the collectability of the amounts due. Our estimates are reviewed and revised periodically based on historical collection experience and a review of the current status of accounts receivable. Historically, actual write-offs for uncollectible accounts have not significantly differed from prior estimates. There was no allowance for doubtful accounts on accounts receivable balances as of September 30, 2024 or June 30, 2024.

 

We may recognize revenue prior to billing a customer when we have satisfied or partially satisfied our performance obligations as billings to our customers may not be made until after the service period has commenced. As of September 30, 2024 and June 30, 2024 we do not have any such contract assets.

Deferred liabilities as of each balance sheet date represent the excess of amounts billed or received as compared to amounts recognized in revenue on our condensed statements of operations as of the end of the reporting period, and such amounts are reflected as a current liability on our condensed balance sheets as deferred revenue. We generally receive payments prior to completion of the service period and our performance obligations. These payments are recorded as deferred liability until the services are delivered or until our obligations are otherwise met, at which time revenue is recognized.

Some contracts also involve annual license fees, for which upfront amounts are received from customers. In these contracts, the license fees received in advance of the platform’s launch are recorded as deferred liabilities.

The following table provides information on the changes in the balance of deferred liabilities:

   Three Months Ended 
Deferred Revenue  September 30 
   2024   2023 
Opening balance  $0   $53,948 
Plus billings   35,625    33,750 
Less revenue recognized   (11,250)   (63,323)
Closing balance  $24,375   $24,375 

Revenue recognized during the three months ended September 30, 2024 and 2023 that was included in the deferred revenue balance that existed in the opening balance of each year was approximately $0 and $26,250, respectively.

The deferred revenue balance as of September 30, 2024 is expected to be recognized over the next 7 months.
Stock-Based Compensation

Stock-Based Compensation

We have issued four types of stock-based awards under our stock plans: stock options, restricted stock units, deferred stock units, and stock warrants. All stock-based awards granted to employees, directors and independent contractors are measured at fair value at each grant date. We rely on the Black-Scholes option pricing model for estimating the fair value of stock-based awards granted, and expected volatility is based on the historical volatility of the Company’s stock prices. Stock options generally vest over two years from the grant date and generally have ten-year contractual terms. Restricted stock units generally have a term of 12 months from the closing date of the agreement. Stock warrants issued have a term of five years. Information about the assumptions used in the calculation of stock-based compensation expense is set forth in Note 3 in the Notes to Condensed Financial Statements.
Technology and Content Development

Technology and Content Development

Technology and content development expenditures consist primarily of personnel and personnel-related expense and contracted services associated with the maintenance of our platform as well as hosting and licensing costs and are charged to expense as incurred. It also includes amortization of capitalized software costs and research and development costs related to improving our platform and creating content that are charged to expense as incurred.

 
Fair Value Measurements

Fair Value Measurements

Accounting standards require certain assets and liabilities be reported at fair value in the condensed financial statements and provide a framework for establishing that fair value. The framework for determining fair value is based on a hierarchy that prioritizes the inputs and valuation techniques used to measure fair value.

Fair values determined by Level 1 inputs use quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.

Fair values determined by Level 2 inputs use other inputs that are observable, either directly or indirectly. These Level 2 inputs include quoted prices for similar assets and liabilities in active markets and other inputs such as interest rates and yield curves that are observable at commonly quoted intervals.

Level 3 inputs are unobservable inputs, including inputs that are available in situations where there is little, if any, market activity for the related asset. These Level 3 fair value measurements are based primarily on management’s own estimates using pricing models, discounted cash flow methodologies, or similar techniques.

In instances wherein inputs used to measure fair value fall into different levels in the above fair value hierarchy, fair value measurements in their entirety are categorized based on the lowest level input that is significant to the valuation. The Company’s assessment of the significance of particular inputs to these fair value measurements requires judgment and considers factors specific to each asset or liability.
Income Taxes

Income Taxes

A current tax liability or asset is recognized for the estimated taxes payable or refundable on tax returns for the year. Deferred tax liabilities or assets are recognized for the estimated future tax effects of temporary differences between financial reporting and tax accounting.

Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statement of operations in the period that includes the enactment date.
Net Loss per Share

Net Loss per Share

At September 30, 2024 and June 30, 2024, the Company had 636,577 and 633,000 potentially dilutive shares of common stock related to common stock options and warrants, respectively, as determined using the if-converted method. For the three months ended September 30, 2024 and 2023, the dilutive effect of common stock options and common stock warrants has not been included in the average shares outstanding for the calculation of net loss per share as the effect would be anti-dilutive as a result of our net losses in these periods.
Subsequent Events

Subsequent Events

The Company evaluated subsequent events through the date of this Form 10-Q and has determined that no events have occurred that would require recognition or disclosure in the condensed financial statements.
Risks and Uncertainties

Risks and Uncertainties

The Company operates in an industry subject to rapid change. The Company’s operations will be subject to significant risk and uncertainties including financial, operational, technological, and other risks associated with an early-stage company, including the potential risk of business failure.
v3.24.3
Significant Accounting Policies (Tables)
 3 Months Ended
Sep. 30, 2024
Significant Accounting Policies [Line Items]  
Schedule of Changes in the Balance of Deferred Liabilities The following table provides information on the changes in the balance of deferred liabilities:
   Three Months Ended 
Deferred Revenue  September 30 
   2024   2023 
Opening balance  $0   $53,948 
Plus billings   35,625    33,750 
Less revenue recognized   (11,250)   (63,323)
Closing balance  $24,375   $24,375 
Property, Plant and Equipment [Member]  
Significant Accounting Policies [Line Items]  
Schedule of Property and Equipment Recorded at Cost The cost of leasehold improvements is depreciated (amortized) over the lesser of the length of the related leases or the estimated useful lives of the assets. Costs of maintenance and repairs are charged to expense when incurred.
    Depreciable Life - Years
Leasehold improvements   Shorter of estimated lease term or 10 years
Furniture and fixtures   7 years
Computer equipment and software   5 years
Finite-Lived Intangible Assets [Member]  
Significant Accounting Policies [Line Items]  
Schedule of Capitalized Software Costs Once the software is placed in service, these costs are amortized on the straight-line method over the estimated useful life of the software, which is generally three years.
   Three Months Ended 
   September 30 
   2024   2023 
Beginning capitalized software  $3,993,691   $3,618,990 
Additions   148,000    65,200 
Ending capitalized software  $4,141,691   $3,684,190 
           
Beginning accumulated amortization  $3,348,863   $2,840,545 
Amortization expense   111,939    146,020 
Ending accumulated amortization  $3,460,802   $2,986,565 
           
Capitalized software - net  $680,889   $697,625 
v3.24.3
Stock-Based Compensation (Tables)
 3 Months Ended
Sep. 30, 2024
Stock-Based Compensation [Abstract]  
Schedule of Options Terminated as well as those that Vested A summary of options that vested in the three months ended September 30, 2024 is presented below:
Options  Number of
Shares		   Weighted
Average
Exercise
Price		   Weighted
Average
Remaining
Contractual
Term
(in years)		 
Outstanding at July 1, 2024   235,219    22.05    5.46 
Additional vesting   3,577    9.50    8.23 
Outstanding and expected to vest at September 30, 2024   238,796    20.96    5.29 
v3.24.3
Significant Accounting Policies (Details) - USD ($)
 3 Months Ended
Jun. 30, 2024
Sep. 30, 2024
Sep. 30, 2023
Significant Accounting Policies (Details) [Line Items]      
Cash FDIC insured amount   $ 250,000  
Amortization expense   111,939 $ 146,020
Revenue from contracts with customers   11,250 63,333
Revenue recognized in deferred revenue   $ 0 $ 26,250
Stock warrants issued term   5 years  
Potentially dilutive shares of common stock (in Shares) 633,000 636,577  
Customer Concentration Risk [Member] | Customer One [Member] | Revenue Benchmark [Member]      
Significant Accounting Policies (Details) [Line Items]      
Percentage of total revenue   100.00%  
v3.24.3
Significant Accounting Policies (Details) - Schedule of Property and Equipment Recorded at Cost
Sep. 30, 2024
Leasehold improvements [Member]  
Schedule of Property and Equipment Recorded at Cost [Line Items]  
Estimated useful lives Shorter of estimated lease term or 10 years
Furniture and fixtures [Member]  
Schedule of Property and Equipment Recorded at Cost [Line Items]  
Estimated useful lives 7 years
Computer equipment and software [Member]  
Schedule of Property and Equipment Recorded at Cost [Line Items]  
Estimated useful lives 5 years
v3.24.3
Significant Accounting Policies (Details) - Schedule of Capitalized Software Costs - USD ($)
 3 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Jun. 30, 2024
Schedule of Capitalized Software Costs [Abstract]      
Beginning capitalized software $ 3,993,691 $ 3,618,990  
Beginning accumulated amortization 3,348,863 2,840,545  
Capitalized software - net 680,889 697,625 $ 644,828
Additions 148,000 65,200  
Ending capitalized software 4,141,691 3,684,190  
Amortization expense 111,939 146,020  
Ending accumulated amortization $ 3,460,802 $ 2,986,565  
v3.24.3
Significant Accounting Policies (Details) - Schedule of Changes in the Balance of Deferred Liabilities - USD ($)
 3 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Schedule of Changes in Balance of Contract Liabilities [Abstract]    
Opening balance $ 0 $ 53,948
Plus billings 35,625 33,750
Less revenue recognized (11,250) (63,323)
Closing balance $ 24,375 $ 24,375
v3.24.3
Stock-Based Compensation (Details) - USD ($)
 3 Months Ended
May 03, 2024
Sep. 29, 2021
Sep. 30, 2024
Aug. 01, 2024
Stock-Based Compensation [Line Items]        
Unrecognized compensation costs     $ 50,052  
Stock-based compensation expense   $ 48,000    
Number of shares available for issuance (in Shares)       250,000
Number of shares granting (in Shares)     822,524  
Market value       $ 720,000
Deferred Stock Units [Member]        
Stock-Based Compensation [Line Items]        
Stock-based compensation expense     $ 62,500  
Cash Compensation [Member]        
Stock-Based Compensation [Line Items]        
Stock-based compensation expense     $ 13,875  
Compensation Committee [Member]        
Stock-Based Compensation [Line Items]        
Stock-based compensation expense   7,500    
Audit Committee [Member]        
Stock-Based Compensation [Line Items]        
Stock-based compensation expense   $ 10,000    
2018 Equity Incentive Plan [Member]        
Stock-Based Compensation [Line Items]        
Number of shares available for issuance (in Shares) 508,488      
Exercised shares (in Shares) 508,488      
v3.24.3
Stock-Based Compensation (Details) - Schedule of Options Terminated as well as those that Vested - $ / shares
 3 Months Ended
Jul. 01, 2024
Sep. 30, 2024
Stock-Based Compensation [Abstract]    
Number of Shares, Outstanding at ending 235,219 238,796
Weighted Average Exercise Price, Outstanding at ending $ 22.05 $ 20.96
Weighted Average Remaining Contractual Term (in years), Outstanding at ending 5 years 5 months 15 days 5 years 3 months 14 days
Number of Shares, Additional vesting   3,577
Weighted Average Exercise Price, Additional vesting   $ 9.5
Weighted Average Remaining Contractual Term (in years), Additional vesting   8 years 2 months 23 days
v3.24.3
Warrants (Details) - shares
Sep. 30, 2024
Jun. 30, 2024
Warrants [Abstract]    
Warrants outstanding 397,781 397,781
v3.24.3
Income Taxes (Details)
Sep. 30, 2024
USD ($)
Income Taxes [Line Items]  
Net operating loss carryforwards $ 28,400,000
Tax Year 2037 [Member]  
Income Taxes [Line Items]  
Net operating loss carryforwards $ 17,000
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