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Discontinued Operations - Sale of E-Core

9 Months Ended

Mar. 31, 2025

Discontinued Operations - Sale of E-Core

Discontinued Operations - Sale of E-Core

Note 18. Discontinued Operations – Sale of E-Core

E-Core, Technology Inc. and its subsidiaries

On August 1, 2024, the Company closed a sale transaction in which, effective as of June 30, 2024, it sold 100% of the outstanding stock of its wholly owned subsidiary E-Core Technology, Inc., a Florida corporation (d/b/a New England Technology, Inc.) (“E-core”), to E-Core Holdings, LLC, a Florida limited liability company (the “Buyer”) pursuant to the terms of an Agreement to Unwind Securities Purchase Agreement dated July 31, 2024 (the “Agreement”). The principals of the Buyer are the three individuals from whom the Company acquired E-core in October 2022. The purchase price in the transaction was $2,000,000 paid by the Buyer to the Company at closing. In addition, in connection with the closing of the transaction (i) the Company was released as a guarantor from E-core’s commercial loan facility, and (ii) all subordinated promissory notes issued by the Company in connection with the Company’s initial acquisition of E-core were cancelled and any outstanding principal and interest thereunder was deemed paid in full. The Agreement contains standard representations and warranties, conditions to closing, and covenants, for a transaction of this nature.

Accordingly, the results of the business were classified as discontinued operations in our statements of operations and excluded from both continuing operations and segment results for all periods presented. Discontinued operations of E-core excluded in the condensed consolidated financial statements for the three and nine months ended March 31, 2024 are as follows:

Summary of discontinued operations:

	Three Months Ended		Nine Months Ended
	March 31, 2024		March 31, 2024
Discontinued Operations
Revenue	$	9,221,715	$	38,625,335
Cost of sales	$	7,606,275	$	33,168,260
Sales, general and administrative expenses	$	1,100,054	$	3,371,876
Depreciation and amortization	$	403,875	$	1,211,625
Other expenses	$	74,666	$	2,476
Income from discontinued operations	$	186,177	$	871,098
Accounts receivable net of allowance for doubtful accounts	$	4,219,460	$	4,219,460
Fixed assets, net of accumulated depreciation	$	-	$	-
Total assets	$	25,184,866	$	25,184,866
Total liabilities	$	5,471,259	$	5,471,259