(10) Subsequent Event

6 Months Ended

Sep. 30, 2013

Subsequent Events [Abstract]

Subsequent Event

(10) Subsequent Event

On November 6, 2013, the Company entered into an Amended and Restated Employment Agreement (the “Employment Agreement”) with Charles Horsey, the Company’s Chairman of the Board, President and Chief Executive Officer. Pursuant to the Employment Agreement:

● The term of Mr. Horsey’s employment has been extended until November 1, 2018.

● Mr. Horsey’s current base salary has been increased to $500,000 per annum. In addition, Mr. Horsey’s base salary will be increased to $550,000 per annum if the Company achieves EBITDA (as defined in the Employment Agreement), in excess of $10 million in any period of four consecutive fiscal quarters, and to $600,000 per annum if the Company achieves EBITDA in excess of $15 million in any period of four consecutive fiscal quarters. Such increases will continue in effect only to the extent EBITDA continues to be in excess of such thresholds.

● Mr. Horsey will be paid a signing bonus in the amount of $150,000.

● Mr. Horsey will be entitled to an annual bonus for each fiscal year of the Company equal to four percent of Pre-Bonus EBITDA (as defined in the Employment Agreement), to the extent the Company achieves the Pre-Bonus EBITDA target established by the Company’s Board of Directors for such year. Such bonus is subject to increase or decrease to the extent actual Pre-Bonus EBITDA for such year is greater or less than the targeted amount, subject to the Company’s achievement of at least 80% of targeted Pre-Bonus EBITDA.

● Mr. Horsey will be entitled to a supplemental bonus with respect to each fiscal year in which the Company’s Adjusted EBITDA (as defined in the Employment Agreement) exceeds both 20% of operating revenue for such year and 110% of Adjusted EBITDA for the prior year.

● In the event of the termination of Mr. Horsey’s employment by the Company other than for Cause, or by Mr. Horsey for Good Reason (as such terms are defined in the Employment Agreement), Mr. Horsey will be entitled to (i) a cash payment in the amount of $100,000, and (ii) aggregate severance payments equal to 18-months’ of his base salary; provided that if the Company’s EBITDA for the preceding four fiscal quarters is less than $5 million, such severance payments shall be equal to 12-months’ of his base salary.

● Mr. Horsey was awarded a stock option to purchase 200,000 shares of the Company’s common stock at an exercise price of $2.00 per share. This option vests with respect to 40,000 shares of common stock on each of October 31, 2014, October 31, 2015, October 31, 2016, October 31, 2017 and October 31, 2018.

● Mr. Horsey was awarded an additional stock option to purchase 400,000 shares of common stock at an exercise price of $2.00 per share. This option vests only upon a Liquidity Event (as defined in the Employment Agreement) as follows: as to (i) 100,000 shares of common stock if the Liquidity Event results in consideration paid to the Company’s stockholders of at least $2.50 per share of common stock but less than $2.80 per share of common stock, (ii) 200,000 shares of common stock if such Liquidity Event results in consideration paid to the Company’s stockholders of at least $2.80 per share of common stock but less than $3.10 per share of common stock, (iii) 300,000 shares of common stock if such Liquidity Event results in consideration paid to the Company’s stockholders of at least $3.10 per share of common stock but less than $6.00 per share of common stock, and (iv) all 400,000 shares of common stock if such Liquidity Event results in consideration paid to the Company’s stockholders of $6.00 per share or more