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Contingencies and Commitments
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3 Months Ended |
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Dec. 31, 2013
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| Contingencies and Commitments [Abstract] | |
| Contingencies and Commitments |
8. Contingencies and Commitments
On April 22, 2013, the Company finalized an Amendment to the Asset Purchase Agreement by and among DMCC Staffing, LLC, an Ohio limited liability company, RFFG of Cleveland, LLC an Ohio limited liability company (each a “Seller” and together, “Sellers”), the Company, and Triad Personnel Services, Inc., an Illinois corporation and wholly owned subsidiary of the Company (“Buyer”).
The Company agreed to pay Sellers additional cash consideration of between $550,000 and $650,000 depending on the length of payments and 1,100,000 shares of common stock, in full satisfaction of all amounts owed to Seller, related to the Asset Purchase Agreement. The Company issued 1,100,000 shares of common stock on July 2, 2013, which was valued at approximately $330,000. The Company elected to pay the cash amount due over two years. To date, the Company paid $275,000 of the cash consideration noted above. The Company has approximately $295,000 recorded in other current liabilities on the condensed consolidated balance sheet at December 31, 2013. There was approximately $20,000 of interest recorded for the three month period ended December 31, 2013.
During the year ended September 31, 2013, the Company sold vehicles with a value of approximately $225,000 and leased them back under a 30 month agreement at an interest rate of approximately 23%. At December 31, 2013, approximately $72,000 is included in other current liabilities and approximately $81,000 in other long term liabilities. The terms are 30 months and the payments remaining totaled approximately $153,000 at December 31, 2013.
Lease
The Company leases space for all of its branch offices, which are located either in downtown or suburban business centers, and for its corporate headquarters. Branch offices are generally leased over periods from three to five years. The corporate office lease expires in 2015. The leases generally provide for payment of basic rent plus a share of building real estate taxes, maintenance costs and utilities.
Rent expense was $237,000 and $277,000 for the three month periods ended December 31, 2013 and December 31, 2012, respectively. As of December 31, 2013, future minimum lease payments due under non-cancelable lease agreements having initial terms in excess of one year, including certain closed offices, totaled approximately $1,875,000, as follows: fiscal 2014 - $793,000, fiscal 2015 - $551,000, fiscal 2016 - $289,000, fiscal 2017 - $159,000 and thereafter - $83,000.
Subsequent to December 31, 2013, the Company is negotiating a final termination agreement with the owners of the Oak Brook facility, our former headquarters. The anticipated terms of the agreement require the Company to pay a termination fee of $125,000. $100,000 will be paid upon execution of the termination agreement and an additional $25,000 will be paid within 30 days of the agreement. At December 31, 2013, the Company has accrued the $125,000 in other current liabilities.
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